02 Jul 2015 | Sören Amelang

Reactions to government decision to adopt alternative to coal levy

The German government finally buried plans for a levy on old coal-fired power plants. Instead, Chancellor Angela Merkel, energy minister Sigmar Gabriel and leading politicians from the ruling coalition adopted a union proposal to pay utilities for mothballing some old lignite power stations at a meeting in the early hours of Thursday. Participants also made a raft of other key decisions on future energy policy - ranging from power market design to the construction of electricity highways and further support for efficiency measures and combined heat and power plants. CLEW presents a brief summary of reactions to the landmark agreements.

For an overview of policy decisions taken, see the CLEW factsheet.

Find a summary of the heated debate about the coal levy here.

 

Mining Union IG BCE 
(IG BCE co-authored the coal proposal politicians have now agreed on)

“Good strategic decision”

“After a long and tough debate, solutions were found that are good for the climate, as well as for jobs and industrial locations. They combine the government’s climate targets with economic reason and social responsibility. That is a balanced outcome and deserves respect and support,” said union head Michael Vassiliadis. “Now we have the chance to manage the gradual closure of a few power plants without redundancies in the energy sector in a socially acceptable manner. It’s important that companies now have planning security and there will be no structural ruptures in regions where lignite is being mined.”

Find the press release in German here.

 

Sigmar Gabriel, Federal Minister for Economic Affairs and Energy

“The Energiewende takes a leap”

"We have managed to reach a historic agreement for new prosperity", Gabriel said at a press conference. “We have managed to tie all loose ends of the Energiewende together…finally, we have a clockwork instead of many different cogs." Gabriel said he understood disappointment over the abandonment of the coal levy. But he argued the heated debate about the levy had forced unions and utilities into a compromise that until recently would have been unthinkable. "Imagine the reactions, had I come out with the proposal of permanent closures first”, he said. “We were convinced the coal levy would not have led to permanent closures, but only pauses at times of low electricity prices." The present agreement would instead lead to permanent shut-downs, Gabriel said. "For the first time in Germany, 13 percent of lignite plants will be mothballed." But he also said decisions on power market design and electricity highways were many times more important for the Energiewende than the coal levy.

 

Germanwatch

“A pyrrhic victory for the coal lobby – The sun is setting on coal”

“There are many signs that this apparent victory for the coal lobby is the beginning of the end of coal,” said policy director Christoph Bals in a statement. "The coal lobby succesfully killed a policy instrument that would have reduced the use of coal in an effective and cost-efficient way. This makes it now much more difficult for Germany to fully achieve its unilateral target of reducing emissions by 40 percent until 2020. However, the coal lobby had to agree to the shutting down of a number of old coal power plants. After this debate, one thing is clear to everyone: The end of coal and how it can be organised in a socially just way is squarely on the German political agenda...Many politicians say in private that they have bailed out the fossil lobby one last time. After this debate, companies and unions are preparing for the necessary structural change,” said Bals.

Find the press release in German here.

 

German Association of Energy and Water Industries (BDEW)

“Decisions point in the right direction, but central questions remain unanswered”

“We have to start talking about the period after 2020”, said BDEW head Hildegard Müller in a statement. “How are we going to achieve the European climate targets for 2030 and beyond without new political infighting?” The association criticised the current agreement does not offer a long-term foundation for a new power market design because the proposals don’t make highly efficient gas-powered plants profitable. “In summary, the agreements point in the right direction. But not a single of the central questions of energy and climate policy has been answered fully.”

Read the statement in German here.

 

German Association of Local Utilities (VKU)

Government recognises importance of combined heat and power

“For the industry as a whole it is important that decisions have finally been made on the major questions of energy policy,” said association head Hans-Joachim Reck in a statement. “It is particularly pleasing that the coalition recognises the importance of combined heat and power for climate protection, and that it decided to maintain and develop this highly efficient technology.”
“With a view to the planned capacity reserve and the associated costs for consumers, it makes sense to consider a broader financing model for the Energiewende. We will also have to make sure that the emissions reductions from lignite will come on top of the reductions that were previously planned.”

Read a factsheet about combined heat and power here.

 

 German Renewable Energy Federation (BEE)

“Strong on power market design, weak on climate protection”

“The BEE strongly welcomes the decisions of the coalition on the power market design but is disappointed in the half-hearted steps for climate protection,” said association head Hermann Falk in a statement. “The decision not to introduce capacity markets is of the same importance as the further development of the power market. But abandoning the climate levy contradicts the principle that the party responsible is liable for damages, and it leads to additional, unnecessary costs.” The association also stressed it was important to make sure that lignite plants which were meant to close anyway must not enter the reserve.

Read the statement in German here.

 

Agora Energiewende

"First concrete step of German coal phase-out"

"The joint agreement by the German government and the coal industry to shut down some coal-fired power plants in order to achieve Germany´s climate targets is significant. It is the first concrete step of a German coal phase-out - something noone would have expected a year ago. It is also a strong signal that Germany still sees itself as a frontrunner in climate ambition.“

 

WWF

"Totally bizarre – New subsidies for old coal plants”

“The coal lobby itself dictated the laws that are now meant to regulate the industry,” said Regine Günther, who is in charge of climate and energy policy at environmental group WWF. “As if this was the most natural thing, it secures billions of euros for old and long written-off power stations, which must now be paid by tax payers and power consumers.”
“But it’s also clear that coal is on the defensive and its territory shrinking. The exit from coal is on the agenda and it won’t go away,” Günther said. “But the results for climate protection are paltry. Without major amendments, Germany will miss its climate target of 40 percent by 2020.”

 

Sandbag

“Happy 50th birthday – RWE’s elderly lignite power stations get a 0.5 billion birthday present”

“The burden of responsibility has been turned on its head: the previous “climate levy” proposal was clearly ‘polluter pays’, but now it is ‘polluter is paid’”, said Dave Jones from environmental NGO Sandbag. "The new proposal from the German government to limit coal emissions seem to write a half billion Euro cheque to 50 year old heavily polluting lignite units.  This is a very generous 50th birthday present for units that are likely to close by 2020, but there are some key ways in which this proposal can be improved, making it less expensive, and cutting emissions faster."

Read the full post in English here.

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