diff --git a/modules/80_optimization/nash/postsolve.gms b/modules/80_optimization/nash/postsolve.gms
index 9f682168e9..4e8f380af1 100644
--- a/modules/80_optimization/nash/postsolve.gms
+++ b/modules/80_optimization/nash/postsolve.gms
@@ -374,12 +374,23 @@ loop((t,regi,entyPe)$pm_implicitPePriceTarget(t,regi,entyPe),
 );  
 $endIf.cm_implicitPePriceTarget
 
-*** check global budget target from core/postsolve, must be within 2 Gt of target value
+*** check global budget target from 45_carbonprice/functionalForm/postsolve
+*** convergence criterion defined via cm_budgetCO2_absDevTol [default = 2 Gt CO2]
+*** positive values of sm_globalBudget_absDev mean that target budget is exceeded (sm_globalBudget_absDev = s45_actualbudgetco2 - cm_budgetCO2from2020)
+*** if damages are not internalized, check positive and negative deviation from target budget
+*** if damages are internalized, only check positive deviation from target budget
 p80_globalBudget_absDev_iter(iteration) = sm_globalBudget_absDev;
-if (abs(p80_globalBudget_absDev_iter(iteration)) gt cm_budgetCO2_absDevTol,
-  s80_bool = 0;
-  p80_messageShow("target") = YES;
-);
+$ifthen.globalBudget "%internalizeDamages%" == "off"
+  if (abs(p80_globalBudget_absDev_iter(iteration)) gt cm_budgetCO2_absDevTol,
+    s80_bool = 0;
+    p80_messageShow("target") = YES;
+  );
+$else.globalBudget
+  if (p80_globalBudget_absDev_iter(iteration) gt cm_budgetCO2_absDevTol,
+    s80_bool = 0;
+    p80_messageShow("target") = YES;
+  );
+$endIf.globalBudget
 
 *** additional criterion: if damage internalization is on, is damage iteration converged?
 p80_sccConvergenceMaxDeviation_iter(iteration) = pm_sccConvergenceMaxDeviation;