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Germany's Coal Commission Proposes 2038 Phase-Out with €40B Support

Germany's Coal Commission sets a 2038 end-date for coal-fired power. The plan includes €40 billion in aid for affected regions and power producers, aiming to balance the transition to renewable energy.

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In this image there is a train on the tracks, to the right of the train there are tracks on the surface, to the left of the train there are trees, electric poles, cars and buildings, on top of the electric poles there are cables, in front of the train there is a bridge and there is smoke coming out of the train.

Germany's Coal Commission Proposes 2038 Phase-Out with €40B Support

Germany's Coal Commission has outlined a plan to phase out coal-fired power by 2038, aiming to reduce emissions and modernise the energy sector. The plan includes significant financial support for affected regions and power producers.

By 2022, coal-fired output will decrease from over 42 gigawatts to 30 gigawatts, equally split between brown coal and hard coal. This reduction will mainly impact lignite production in the Rhineland area, with a planned 5 GW cut. To compensate power producers, the government considers capacity tenders or keeping plants on standby. The Commission also proposes converting some coal-fired plants to burn imported fossil gas.

The plan allocates at least €2 billion per year to reduce network costs and avoid surcharges on electricity prices. Additionally, the four coal-producing Bundesländer - North Rhine-Westphalia, Saxony, Saxony-Anhalt, and Brandenburg - will receive at least €40 billion over 20 years for structural change aid. An independent panel will assess the measures in 2023, 2026, and 2029.

Despite criticism from environmental groups like Greenpeace, which deems the 2038 end-date 'unacceptable', the Coal Commission's plan aims to balance the transition towards renewable energy with support for affected regions and power producers. The success of this plan will be reviewed periodically to ensure it stays on track.

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