New German govt should use existing draft law for new gas power plants – energy industry
Clean Energy Wire
[UPDATE adds quotes by minister Reiche, Commissioner Ribera]
The new German government should largely adopt the previous government's plans for building new gas power plants to ensure a rapid back-up for the growing share of renewables, the country's energy industry has said.
According to the Federation of German Energy and Water Industries (BDEW), the country’s new economy and energy minister, Katherina Reiche from the conservative Christian Democratic Union (CDU), should use the 2022 draft for the Power Plant Security Act, which was prepared by her predecessor, the Green's Robert Habeck, as a blueprint to ensure no more time is lost in launching the necessary auctions. “We strongly support the minister in very quickly paving the way for the construction of new steerable capacity,” said BDEW head Kerstin Andreae.
Given that more steerable generation capacity will drop out of the market on the path towards the country’s planned coal exit by 2038 at the latest, companies need a clear framework to initiate investments in the required gas plants. Using the previous government’s draft, which has already been agreed by the European Commission’s state aid watchdog, and adapting it where necessary could greatly accelerate the groundwork that companies can build on, Andreae argued.
"Mainly gas-fired power plants" – minister
After a meeting with EU Executive Vice-President for a Clean, Just and Competitive Transition Teresa Ribera on Monday (19 May), minister Reiche said she aimed to find consensus with the European Commission “over the coming weeks or months” and added that the steerable generation capacity of 20 gigawatt is “expected to be mainly gas-fired power plants.”
The Commission is waiting for the new government to decide on how to proceed. Commissioner Ribera said that Germany still had to provide details on the plans for financing new gas plants. “We still need to be much more precise on what we are talking about,” she replied when asked whether German plans were in line with EU rules.
BDEW's Andreae said time was of the essence. “If auctions were to start at the beginning of 2026, it can be assumed that the first new power plants could go into operation at the end of 2030 or the beginning of 2031. That is why it is so important that we act quickly now,” she added. “Our goal is: as little adaptation of the draft as possible and as much adaptation as necessary,” to secure investor confidence as well as consent by the European Commission, the BDEW head said, following a consultation of its members.
Habeck’s draft had initially proposed the construction of 12.5 gigawatts (GW) of new gas plant capacity. The coalition treaty of the new government revised up this figure to 20 GW, which is likely to require new negotiations with the EU. BDEW stressed that relieving investing companies from the pressure to follow a strict conversion timetable towards hydrogen would be a prerequisite for investors, as many of the factors influencing the switch are beyond their own influence, for example the availability of the alternative fuel or sufficient demand from buyers.
Under Habeck's plans, the new plants were meant to use green hydrogen at a later stage in order to cut emissions. The new government has said it plans to allow carbon capture (CCS/CCU) for gas plants.
