Technology as a key issue

Less electricity from coal

To meet the climate targets, Germany must reduce electricity from coal. In the interim, coal consumption has fluctuated, rising from 2011 to 2013 but falling one percent below the level of 2010 by 2016. A further reduction is needed for Germany to reach its carbon reduction targets by 2020, however.

When Germany resolved to shut down eight of its seventeen nuclear plants in 2011 and phase out the rest of them by 2022, there was concern that coal power would be ramped up to fill the gap left behind by nuclear. That switch is not the plan, however, because the country cannot meet its climate targets with coal power. After all, roughly half as much carbon is emitted when natural gas is burned instead of hard coal. Lignite, which is domestically available in Germany in large quantities, is three times more carbon intensive than natural gas. Furthermore, coal plants do not ramp up and down as fast as flexible gas turbines, making the latter a better way of filling gaps in fluctuating renewable power generation.

For a number of reasons, however, coal power consumption temporarily increased:

  1. The decision to shut down eight nuclear power plants came suddenly, and industry has not yet had time to replace the missing capacity, so power providers have no choice but to fall back on existing power plants;
  2. The economic downturn within the EU has reduced energy consumption, thereby indirectly reducing carbon emissions and the price of carbon, and hence, the price of coal power; and
  3. At present, a few new coal plants are going online that had been planned and constructed several years before the nuclear decision.

Plans for new coal plants

Just a few years ago, Germany's biggest four energy firms planned to build more than 30 new coal plants, but the last coal plant may have already been built in Germany. A number of projects have been abandoned for various reasons ranging from tremendous local protests to difficulties in procuring water rights and – most of all – a reassessment of profitability in light of the boom in renewables. Furthermore, no coal plants have been proposed since the nuclear phase-out of 2011, while several previously planned projects have since been abandoned.

During the nuclear phase-out (up to the end of the year 2022), the share of lignite in the power sector is likely to remain relatively stable. Depending on how fast the share of renewable electricity grows, power from hard coal may, however, be significantly offset even during the nuclear phase-out.

In 2015, there was a concerted effort to launch a coal phase-out in Germany. Labor unions took to the streets in protest, estimating that some 100,000 jobs would be on the line. The ambitious plan to place a limit on carbon emissions from coal plants older than 20 years was therefore blocked politically. In its place, a "reserve" was created for lignite plants; 2.7 GW of them were taken off the market. They are to be reactivated if need be. In the meantime, they receive special compensation for their "standby readiness."

Critics point out, however, that these plants are not "ready" at all. The plants are to be given ten days notice of the need to ramp up. Experts argue that there will never be a situation in which a grid bottleneck or power generation shortfall can be foreseen ten days ahead. In effect, this policy solely pays the polluters.

But the debate on coal in Germany continues. In 2016, there were signs that labor union leaders had begun accepting the inevitability of a coal phase-out and would begin focusing on getting the best deal for workers. A Coal Commission, consisting of local and national policy makers, trade unions, business associations and community leaders is set to investigate a coal phase-out after the general elections in September 2017. The main issue revolves around how the coal communities can revitalize and find new economic opportunities for the time when coal mines and plants are shut down.

Carbon Capture and Storage not an option for coal power

Over the past decade, there has been a lot of talk worldwide about carbon capture and storage (CCS), which the technology's proponents misleadingly call "clean coal." Essentially, this technology captures pollutants and carbon dioxide for separate storage. For industrial processes such as cement production, in which it is extremely difficult to reduce emissions further, CCS could be an option to reduce greenhouse gas emissions. In power plants, however, CCS is viewed by most energy experts as unattractive because it drastically reduces the efficiency of the power plants, thus severely increasing fuel costs.

Furthermore, CCS investments turn out to be prohibitively expensive. Germany set up the first such test facility designed by Siemens in 2006 at Schwarze Pumpe, a coal plant run by Swedish utility Vattenfall at the time. Vattenfall announced at the end of 2011 that it had abandoned plans for a second demonstration project of 300 megawatts, which would have been ten times the size of the pilot facility at Schwarze Pumpe, thereby even foregoing funding from the EU for the first full-size CCS plant. Vattenfall said it was unable to go ahead with its plans because the German states with suitable storage potential refused to accept the risk.

In addition, environmentalists are generally not excited about the technology, as stored pollutants and CO2 will only create further problems for future generations, who will have to make sure that the storage facilities do not leak. Local communities do not wish to have repositories for carbon dioxide near them, so Merkel's coalition – which supports CCS – reached a compromise with the German states in 2012. Now, the states will be able to veto plans to construct carbon dioxide repositories, making it highly unlikely that any such repository will ever be built. The agreement also specifies that the states – and hence taxpayers – will be liable after the first 40 years of operation, with the company liable for the first 40.

In July 2012, former German Energy Minister Peter Altmaier himself gave up on the idea of CCS within Germany: "We have to be realistic. We cannot store carbon dioxide underground against the will of the population. And I do not see any political acceptance in a single German state for CCS technology with hard coal and brown coal power plants."