Chiemgauer, the currency invented in the Chiemgau region
It all started as a school project to promote local business in a remote region of Bavaria. Now, the “Chiemgauer” coin helps reduce emissions.
Walk into a bakery or bookstore in the Chiemgau area of Bavaria and you might see a customer paying with what looks like play money — colorful notes printed with grasshoppers, ladybugs and other insects.
“It is estimated that 10 to 15% of customers pay this way“, a bookseller told DW.
Locals call it “Chiemgauer” and it is a currency that they invented themselves.
As peculiar as it may seem, it supports a microfinance system which has been operating for more than two decades and has recently become a tool for reducing carbon emissions in this picturesque corner of southeast Germany.
A classroom experiment that got out of control
The Chiemgauer was born in 2003 at a local high schoolwhere economics professor Christian Gelleri and a group of students were looking for a way to support local businesses that were losing customers to malls and big chains.
The solution found was a new currency, created to keep money circulating in the region. They printed it, distributed it, and little by little local residents began to use Chiemgauer and stores began to accept it.
Slowly, a classroom idea turned into a financial system.
“Five million Chiemgauers are spent annually nowadays”, said Gelleri, who still heads the association that manages the currency, Chiemgauer eV. Currently, €1 is equivalent to one Chiemgauer.
In his office in the town of Traunstein, at the foot of the Alps, Gelleri opens the group’s safe and reveals thick stacks of notes.
“They are more than 200 thousand Chiemgauer notesthe equivalent in euros”, said Gelleri, proudly. These banknotes are now produced by a specialized company and have watermarks and anti-counterfeiting characteristics.
According to German law, printing and using non-euro money can be considered a crime. But, as Chiemgauer is restricted to the region and used only by around 4200 people and 300 companies, Germany’s Central Bank, the Deutsche Bundesbank, tolerates it. Anyone who wants to use the currency needs to join the Chiemgauer association.
How a Little Trick Keeps Money in Circulation
A walk through Traunstein’s shops, with their colorful facades, illustrates how the system works. In an organic food store, a customer pays for cheese and sausage with a 50 Chiemgauer bill. “I myself have an organic products store and I use part of the money I earn from Chiemgauer notes for my purchases,” he told DW.
The same happens with a seller of Mediterranean delicacies at a market stall. “We use our earnings in Chiemgauer to pay the supplier from whom we buy the fresh ingredients,” he explained. In this way, money circulates, either in cash or electronically with a special card that works with common bank accounts.
To keep a valid note and the Chiemgauer in circulation, holders must buy a small stamp every six months. The stamp for a 10 Chiemgauer note costs around 0.30 euros, for example. After three years, the notes expire completely. Private users cannot convert Chiemgauers into euros. Businesses can convert the currency but pay a 5% fee to do so. This fee funds the currency’s operations and supports local non-profit organizations.
Buy solar panels for your balcony and receive free Chiemgauers
In recent years, Gelleri and the Chiemgauer organizers have introduced an environmental dimension to their currency. Residents can now earn bonus Chiemgauers when making sustainable choices — whether it’s repairing jeans instead of buying new ones, using car-sharing platforms, or insulating their homes with natural materials. These actions are rewarded with bonuses ranging from one to 200 Chiemgauers.
“The owner of this set of solar panels earned 100 Chiemgauers,” said Gelleri, pointing to two panels installed in a yard in Traunstein. “In 20 years, this set of solar panels on the balcony will save 11 tons of carbon dioxide“.
Residents and local businesses finance the rewards by contributing to a common fund to offset their emissions, in a kind of mini emissions trading system. For every ton of carbon offset by the fund, 9 tons are saved thanks to the sustainable behavior it encourages.
Similar climate bonus schemes have spread from Bavaria to four more regions in Germany. Over the last four years, the initiative has allowed save a total of 12,800 tons of CO2, the equivalent of the emissions of around 2000 German cars in the same period, according to the independent audit TÜV Nord.
A small global trend
Chiemgau’s coin is far from unique. There are about 300 “complementary currencies” — so called because they work in conjunction with a country’s official currency — all over the world. The majority are concentrated in Europe and Brazil, where the focus is on promoting the local economy and well-being. But, as a side effect, they also reduce emissions from the transport sector.
“Complementary currencies encourage local consumptionwhich in turn shortens supply chains as sellers buy locally made products,” said Ester Barinaga, a complementary currency researcher at Lund University in Sweden. According to MIT and the International Energy Agency, freight transport is responsible for 8% of global greenhouse gas emissions.
Some of these currencies are specifically designed to encourage eco-friendly behavior. In the Spanish city of Viladecans, for example, “Vilawatt” rewards residents for saving energy. In Indonesia, the Philippines and elsewhere, they are distributed “Plastic Bank” tokens to people who collect and deliver plastic bottles for recycling.
However, all of these coins have their limitations, and Chiemgau’s is no exception. Clothing, electronics and most manufactured goods are still produced abroad and imported. Less than 1% of the region’s population participates in the system. And if it grew too much, Germany’s central bank could intervene to regulate it.
Still, for Barinaga, complementary currencies bring an important lesson, however small it may be in general terms. “Money can be structured,” he said. “If money is created to reward pro-environmental behavior, then we will have more people acting in a pro-environmental way.”
