Loss-making coal plants could turn into liability for German taxpayers – NGO

As lignite (brown coal) power plants in Germany increasingly make losses, the funding for clean-up activities in former mining regions is coming under threat, meaning that taxpayers might eventually have to foot the bill, NGO Green Budget Germany (FÖS) says. "Existing rules do not protect against insolvency," FÖS writes in a press release, arguing that depositing securities and company liability rules are needed to avoid that costs are passed on. "The tense economic situation of lignite plants makes it clear that hedging the financial risks has become more urgent than ever before," the NGO says. "The current system is based on lignite continuing to make lots of money in the future. This has long ceased to be the case," FÖS's Swatnje Fiedler said. The NGO calls on the new governments in the lignite mining states Saxony and Brandenburg to address the problem and ensure that mining operator LEAG does not shift the costs for renaturation of former open cast mines on the state.

Analyses from NGOs have suggested that Germany's lignite plants have made hundreds of millions in losses in the first six months of 2019 alone, putting into question the operators' demands for compensation in the framework of Germany's planned coal phase-out. Energy company RWE rejected the analysis, saying it "does not stand up to the facts”. Also Germany's Council of State Governments (Bundesrat) in the past has expressed fears mine operators have not set aside enough money to cover the future costs of decommissioning plants and renaturing mined land.