Europe's largest economy reduced its emissions by 1.9 percent in 2022 compared with the previous year, the federal environment agency said in a statement.
In total, Germany pumped out 746 million tonnes of greenhouse gases in 2022, 10 million tonnes less than its legal target for the year.
The drop came despite rising emissions in the energy sector, as Germany resorted to mothballed coal power plants to manage an energy crisis unleashed by the war in Ukraine.
The dwindling of important natural gas supplies from Russia sent Germany scrambling to find alternative sources of energy to heat its homes and power industry.
Emissions in the energy sector rose by 4.4 percent overall, the second consecutive year they had gone up, according to the agency.
Since 1990, Germany had managed to reduce its emissions by 40.4 percent, it said.
But the traditional industrial powerhouse would have to pick up the pace to hit its climate targets for 2030.
Emissions needed to be driven down by six percent a year, while Germany was averaging a yearly reduction of under two percent since 2010, the agency said.
In 2022, a record 20.4 percent of Germany's energy was produced from renewables such as solar and wind, according to the federal body.
Nonetheless, "a much faster pace in the expansion of renewable energy" was essential to hit the 2030 target, agency chief Dirk Messner said.
"We simply cannot afford this fatal dependence on fossil fuels," Messner said.
"I had expected the energy numbers to be worse given the Russian war of aggression," Economy Minister Robert Habeck said in a statement.
The results were "encouraging", Habeck said, while calling on climate protection measures to be expanded "without hesitation".
A previous study by the energy think tank Agora Energiewende calculated Germany had slightly overshot its target for 2022.
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