Is Germany changing course on coal?

3 December 2014

Germany has a problem. Europe’s biggest economy currently risks missing its national 2020 mitigation target of a 40% reduction from 1990 levels. Despite the boom of renewable energies, Germany’s emissions have been on the rise again for the last two years. If you think this is due to the country’s nuclear phase-out, then think again. In reality, with 27% of German electricity production originating from renewables today,this clean technology represents a higher share than nuclear power used to have. The real reason for Germany’s rising emissions is the continuously low price for emission certificates in Europe’s creeping Emission Trading Scheme. With no credible CO2 price signal, the burning of coal remains highly profitable for energy suppliers in Europe. In Germany, this is causing not only higher emissions but also a huge surplus of electricity.

To address this, Germany’s Environment Minister Barbara Hendricks, when traveling to Lima next week, will have some news in her baggage. Today, the government presents an “Action Plan”on how to fill the emission gap and reach Germany’s 2020 climate target. In this plan, following public debate, Germany is announcing an additional reduction of 22 million tonnes of CO2 from the electricity sector.Although ECO finds that the formulation is vague and the reduction too low, the facts behind the Action Plan are clear: For the first time ever, Europe’s biggest economy intends to remove a part of its coal power capacity from the grid.

ECO thinks this is an important signal to Lima: if countries want to tackle climate change, they need to phase-out coal and phase-in renewable energy technologies and increased energy efficiency. As a next step, ECO urges Germany to not only address coal emissions at home, but also credits and export guarantees for coal power plants abroad. This is not unprecedented: some days ago, France addressed this issue,as the US did before them. Moreover in the UK, no new coal power plants can be built.

Even the German industry has been surprisingly supportive here: last Sunday, the biggest German energy supplier E.ON announced the sale of its coal, gas and nuclear business and their focus on renewables, grid and energy services. The German G7 presidency should build on these developments and form a coalition of the willing to start what the climate needs: a socially responsible phase-out of fossil fuels and 100% Renewables for all, as fast as possible.

Is Germany changing course on coal?

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