Levy on most polluting power stations is scrapped, but largest brown coal-fired plants will be shuttered as Germany moves to cut emissions 40% by 2020

This article is more than 5 years old

This article is more than 5 years old

Germany agreed on Thursday to mothball about five of the country’s largest brown coal power plants to meet its climate goals by 2020, after months of wrangling between the parties in chancellor Angela Merkel’s coalition.



But Merkel and the leaders of her two junior coalition partners also, in effect, agreed to set up a “capacity reserve” system where utilities could switch on the brown coal plants if there were power shortages in the country.

An economy ministry spokesman said the decision on brown coal would mean Germany could meet its goal of reducing German CO2 emissions by 40% by 2020 compared to 1990. The goal is much more ambitious than the EU-wide target of the same cut by 2030.

“Brown coal-fired plants with a capacity of 2.7 gigawatts will be mothballed. Those plants will not be allowed to sell any electricity on the normal power market,” said a spokesman for the economy ministry after the talks which lasted four hours.

In a television interview, economy minister Sigmar Gabriel expanded on the plans, which are part of Germany’s switch to renewable energy away from nuclear and fossil fuels.

“We need a capacity reserve on the power market in case there are shortages due to the switch to renewables. The reserve will be made up of brown coal,” Gabriel told ARD television.

Gabriel originally proposed putting a levy on CO2 emitted by the oldest and most-polluting power stations above a certain threshold to help curb CO2 emissions from the coal sector by a further 22m tonnes by 2020.

But he faced a backlash from industry, with unions saying the plan could put up to 100,000 jobs at risk and lead to the decline of the mining and power generation industries.

The utility companies lobbied hard against the levy and demanded compensation for an alternative reserve option.

While the levy now seems to be scrapped, it is unclear whether companies such as RWE or Vattenfall Europe will get compensation payments or not.

Gabriel also said the leaders of the coalition had agreed that taxpayers should not end up paying for provisions for the costs of the nuclear phase-out.

“We agreed that we want to ensure, a bit like parents being responsible for their children, that a situation doesn’t arise where, due to changes within companies, taxpayers have to pay for the provisions,” Gabriel said.

Merkel and her coalition partners also settled a dispute over high-voltage power lines, planned to carry green energy from the north to the industrial south, with an agreement to avoid bottlenecks and have a uniform price structure.