Picture: 123RF
Picture: 123RF

Frankfurt — Germany’s energy regulator on Tuesday said about 4,788MW of hard coal-fired power generation capacity will cease to be marketable from January 1 2021 as part of a policy to take carbon-polluting capacity out of the market.

The move reflects Germany’s commitment to ending the fossil fuels age, idling the equivalent of five nuclear plants in one go, while cushioning the effect on utilities, regions and employment.

“The tenders have met with a positive response from the operators. The round was clearly oversubscribed,” said the head of the Bundesnetzagentur regulator, Jochen Homann.

The average payment operators will receive to shut plants is €66,259/MW, incurring total public spending of €317m.

Bids ranged between €6,047/MW and €150,000/MW.

Germany has decided to abandon coal by 2038 and achieve a mostly carbon-free energy system by 2050.

A separate offset scheme for shutdowns in the brown coal-to-power industry is still under review by the European Commission.

The list of plants affected includes Swedish utility Vattenfall’s Moorburg, RWE’s Westfalen and Ibbenbueren, and Uniper’s Heyden.

Grid operators have until March 2021 to object and demand that system relevant plants stay open, but by July 2021 are moved to standby operations and support networks during bottlenecks.

Marketing of power output must stop on January 1 at the 11 plants but previously ordered volumes can still be produced.

The regulator said decisions had not been guided by price alone but it had also borne in mind the relationship between the cost and the resulting CO2 reductions.

Uniper said it would swiftly implement the plan for Heyden and RWE spoke similarly of its plans.

The scheme carries on in coming years, with next bids due up to January 4.

After 2027, hard coal plants can be ordered to shut without offsets.

Reuters

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