Germany's government has announced a cash boost for measures to cut greenhouse gas emissions in a bid to meet its target for 2020.

Germany has pledged to reduce its carbon dioxide output by 40 percent by the end of the decade, compared to 1990s levels.

Economy Minister Sigmar Gabriel told reporters on Wednesday that the government is increasing subsidies for energy efficiency measures to 3.4 billion euros ($4.2 billion) from 2 billion euros a year.

Germany hopes the cuts will save a further 62 to 78 million tons of CO2 emissions by 2020, compared to current forecasts.

Gabriel says some 22 million tons of savings will need to be made by utility companies that generate power from coal.