Friday, December 17, 2021

Germany: EU plans thwart Germany's energy shift

 EU guidelines with very strict precepts on gas power plants could lead Germany to extend the operating time of coal power plants the government wanted to give up by 2030, reports WELT:

The new federal government would like to "ideally" bring the coal phase-out in Germany forward from 2038 to 2030. But the traffic light coalition partners encounter immense problems right at the beginning of their project. In addition to the even declining production of renewable energies, new specifications from Brussels threaten to make it more difficult to achieve the targets.

The starting position for the planned energy transition turbo of the new federal government deteriorated considerably on Wednesday: According to the latest figures from the German Association of Energy and Water Management (BDEW), the goal of achieving 80 percent green electricity in Germany by 2030 has become little more unrealistic. Accordingly, the share of renewable energies in gross electricity consumption has even shrunk from 46 percent to 42 percent this year. The main reason for this was poor wind conditions.

It is therefore ruled out in specialist circles that renewable energies can replace the capacities of coal and nuclear power that will be lost in the near future. Almost every study on the achievement of the German energy transition targets assumes that gas-fired power plants will have to be built to a considerable extent by 2030 in order to be able to temporarily close the electricity gap.

It is a huge order of magnitude. Depending on the assessment, institutes consider new gas power of over 15 gigawatts (German Energy Agency), 30 to 40 gigawatts (EPICO think tank) or even 43 gigawatts (Boston Consulting Group) to be necessary to secure the electricity supply by 2030.

In just eight years, Germany would have to build at least 50, maybe even 140 new gas-fired power plants of the 300-megawatt class out of the ground. With planning and construction times of at least six years, this can only succeed if it is started immediately.

But at the moment when Germany is desperately looking for investors for new gas-fired power plants, the EU Commission is making the conditions for this much more difficult. According to a proposal by France, Brussels only wants to award the rating "sustainable" in the so-called taxonomy regulation to those gas-fired power plants that produce less than 100 grams of CO₂ per kilowatt hour. Only: Such gas-fired power plants are not even on the market yet. The most modern gas-fired power plants today emit three times as much, around 300 grams of CO₂ per kilowatt hour.

However, no investor should be prepared to invest in gas-fired power plants if they do not receive the EU seal of approval for "sustainable" electricity generation. Because the risk would be too great that climate policy pressure would soon lead to an early shutdown of the expensive systems.

The roughly 900 municipal electricity suppliers in Germany in particular are facing mischief: "If the limit of 100 grams of CO₂ becomes part of the EU taxonomy, no one in Germany will probably build gas-fired power plants for years," says Ingbert Liebing, General Manager of the Association of Municipal Enterprises (VKU ). The result: "For reasons of security of supply, there would then be no other choice than to let coal-fired power plants run longer or to import nuclear power from France." Moving forward the coal phase-out to 2030 under such conditions would, according to Liebing, be "illusory".

As a municipal supplier with particularly close customer loyalty, the municipal utilities, which operate a considerable part of the gas-fired power plants in Germany, do not want to let things get that far. A compromise proposal that the VKU is now feeding into the Brussels taxonomy negotiations is intended to keep investors in line and at the same time reduce emissions from gas-fired power plants over time.

The Stadtwerke-Verband advocates a change from a rigid limit to a budget. New gas-fired power plants are to be allocated 820 kilograms of CO₂ per kilowatt and year of installed capacity, which they can use flexibly over the term. "This budget is also extremely ambitious and acts like a CO2 brake that has an increasingly strong effect over time," Liebing promotes the proposal: "The budget approach ensures that the operator of the power plant pursues a decarbonization strategy at an early stage by switched to hydrogen, for example. "

Brussels could not find out whether the compromise formula still has a chance of being taken into account in the taxonomy decision. There is not much time left: the EU Commission wants to reach a final decision on the so-called delegated legal acts on this topic by the end of the year.

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