11 Nov 2014 | Kerstine Appunn

German minister warns against quick exit from coal power

Germany still needs electricity from coal while shifting to a green economy, Energy Minister Sigmar Gabriel said, reassuring utilities that a quick phase-out of the fossil fuel was not his plan.

Germany's Minister for Energy and Economic Affairs Sigmar Gabriel has warned against the consquences of a quick phase-out of coal as a power source.

Abandoning coal and nuclear power simultaneously would lead to exploding electricity costs and energy-insecurity and force industry to move production abroad, Gabriel said in a statement issued by his ministry on Tuesday. "We have to end the illusions in German energy policy," Gabriel said.

However, the energy minister added that he agreed with the idea that coal-fired power plants be taken off the grid "step by step" as suggested by his colleague and fellow Social Democrat, Environment Minister Barbara Hendricks.

German media interpreted his comments as another sign of a reported clash of opinions of the two ministers. It comes just weeks before the governing coalition of Gabriel's SPD and Chancellor Angela Merkel's conservative CDU is to decide on a “climate action programme” detailing how Europe’s biggest economy may yet meet its greenhouse gas reduction target of 40 per cent by 2020 compared to 1990.

“If we want to have 55 to 60 per cent renewable energy in 2035 then we will need coal and gas power for the rest,” Gabriel said in the statement. He argues that giving up German coal plants would not save any CO2 because those freed emission allowances would just go to other power stations in Europe, so the best option would be to reduce the number of CO2 allowances handed out by the European Union.

He said utilities should decide themselves which power stations they want to shut down and said he believed this way German greenhouse gas reduction targets can still be met. Germany is likely to face a 7 per cent shortfall of its CO2 reduction target for 2020, which is why Hendricks as well as the Green Party are pushing for a fast shutdown of old coal power stations.

Gabriel’s announcement also laid out positions for talks with the new Swedish Prime Minister Stefan Löfven concerning the possible sale of lignite power stations and mines in Germany, run by Swedish state-owned utility Vattenfall. Vattenfall’s businesses, be it hydropower or coal mining should remain in one hand, Gabriel said, as splitting up operations would put jobs and the future of the company at peril. The utility had earned billions in Germany in the past and now has a responsibility to retain jobs and and an affordable energy supply, Gabriel added.

Vattenfall had announced two weeks ago that it was looking to sell its German lignite mining and power operations.

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