• Germany's news in English
 
app_header_v3

Energy giants pull plug on coal and nuclear

18 Aug 2013, 09:42

Published: 18 Aug 2013 09:42 GMT+02:00

Ever since Chancellor Angela Merkel announced a phase-out of nuclear energy over the next decade and pledged to generate as much as 80 percent of the country's electricity from renewables by 2050, big question marks have been hanging over the future of coal and gas-fired plants in Germany.

Merkel, seeking a third term in general elections on September 22nd, is a staunch supporter of this hugely popular policy move.

But the turnaround is depriving utilities, including market leaders RWE and E.ON, of massive profits from their atomic plants and turning their gas and coal-fired stations into loss-makers as they are sidelined by rival renewable sources of energy.

Last week, the two biggest players in the German sector unveiled steep drops in profits, and "many of our plants are operating at a loss," complained RWE's finance chief Bernhard Günther.

Indeed, RWE announced that it would shut down a number of plants --representing combined capacity of 4,300 megawatts -- in both Germany and the Netherlands. And more could follow, Günther warned.

The networks agency that oversees such closures has received 15 such applications since the end of 2012, according to a spokeswoman.

It was not immediately clear whether RWE's plants were part of the number, but Norway's Statkraft for one has also announced plans to pull the plug on two sites in Germany.

With political clout firmly behind renewables, priority is given in the national power grid to so-called "clean" electricity, which means that all power generated from wind turbines or solar panels is pumped into the grid, while that produced by coal and gas-fired plants is used simply to make up for any shortfalls.

Following the boom of solar power in recent years, nourished by generous subsidies, the capacity of renewable sources of energy is such that, if the wind is blowing and the sun is shining, Germany can actually do without its conventional power plants.

In the period from April to June, a number of RWE's plants were operating at less than 10 percent of capacity, said finance chief Günther.

And with wholesale electricity prices at the current lows in Europe, that means substantial losses. That was the case with gas-fired plants until recently, but coal-fired generators are now barely profitable as well, he said.

Before reaching a deal in April, E.ON fought for months with the regional authorities over the fate of its gas plant in Irsching in Bavaria, which came online in 2010, but is merely just ticking over.

E.ON finally conceded to the requests of the authorities to keep it up and running, but only in return for payment.

The networks agency has warned that it is loath to approve many closures in the south of Germany.

Generation from renewables is dependent on the weather and conventional generation must make up for any shortfalls. But operators want compensation.

Story continues below…

At the moment, E.ON's plants "are working for nothing," raged chief executive Johannes Teyssen last week, who is eyeing other closure scenarios and a possible relocation to Turkey where the group already has a solid presence.

But an industry source told AFP that "I think it's more a threat. It would be very, very complicated and I'd be surprised if they were seriously considering such a move."

Such sabre-rattling is certainly the norm in any pre-election period. But the sector is expecting a massive re-think by the future government about the modalities of the energy turnaround.

"All the problems are known and identified. There won't be any respite for the incoming government," said Hildegard Müller, president of the sector's BDEW federation.

AFP/pvs

Your comments about this article

Today's headlines
Sinking Deutsche Bank stock sends shock across Europe
Photo: DPA

Shares in Germany's biggest lender Deutsche Bank plummeted on the Frankfurt stock market on Friday, dragging other European banks and global markets down with it, after reports some customers were pulling money out.

The Local List
10 things you never knew about German reunification
Reunification celebrations in Hanover in 2014. Photo: DPA

With German Unity Day (October 3rd) happening on Monday, Germans are looking forward to a three-day weekend. But did you know these facts about reunification and German Unity Day?

Munich pharmacy’s nighttime porno show draws crowd
Photo: DPA

When a police patrol in Munich's Sendlinger Tor area noticed a crowd gathered outside a pharmacy window they went to investigate. But the onlookers weren't interested in a new line of flu medicine.

Small town mayor beaten up for plan to house refugees
File photo: DPA.

The mayor of the small northern town of Oersdorf, Schleswig-Holstein, was beaten up by an as yet unknown person, police reported on Friday, seemingly because of plans to provide a home for refugees.

Fire at major Ruhr area hospital kills at least two
The fire in Bochum. Photo: DPA

Tragedy struck the western German town of Bochum on Friday morning when a huge fire broke out in a hospital in Bochum, killing at least two people.

Merkel condemns 'barbarous' Russian strikes on Aleppo
Photo: DPA.

US President Barack Obama and German Chancellor Angela Merkel condemned what they called "barbarous" Russian and Syrian regime airstrikes on Aleppo during a phone call Thursday, the White House said.

Self-driving Tesla car hits bus on Autobahn
A Tesla Model S on autopilot. Photo: DPA / obs / ADAC

Questions about Tesla’s self-driving cars are now being raised in Germany after an accident on Wednesday.

Lion shot dead at Leipzig Zoo after breaking out of cage
Motshegetsi (l) und Majo. Photo: DPA

A young male lion was shot dead at Leipzig Zoo on Thursday afternoon after he broke out of his enclosure.

EU takes Germany to court for 'discriminatory' foreigner toll
A sign that reads "toll" along the Autobahn by Rostock. Photo: DPA.

The European Commission on Thursday said it is taking Germany to the EU Court of Justice because of the country's plan to impose a road toll that would mainly charge foreign drivers.

After 3-year trial, suspected neo-Nazi terrorist speaks out
Beate Zschäpe. Photo: DPA

Beate Zschäpe, the only living member of an underground neo-Nazi cell accused of murdering ten people, has spoken to the court in Munich after three years of silence.

Sponsored Article
The Inner Circle: the secret to dating in Berlin
Germany's 10 most Instagram-able places
Sponsored Article
Why Jordan is the ‘Different’ East
Lifestyle
15 pics that prove Germany is absolutely enchanting in autumn
Lifestyle
10 German films you have to watch before you die
Lifestyle
6 things about Munich that’ll stay with you forever
Sponsored Article
Retiring abroad: ensuring your health is covered
Lifestyle
10 pieces of German slang you'll never learn in class
National
Seven great reasons to stay in Germany this September
National
Ouch! Naked swimmer hospitalized after angler hooks his penis
National
Six reasons why Berlin is now known as 'the failed city'
Sponsored Article
Life in Jordan: 'Undiscovered treasure'
National
15 tell-tale signs you’ll never quite master German
Culture
7 American habits that make Germans very, very uncomfortable
Sponsored Article
The Inner Circle: the secret to dating in Berlin
Rhineland
Story of a fugitive cow who outwitted police for weeks before capture
Culture
Eleven famous Germans with surnames that'll make your sides split
Lifestyle
The best ways to get a visa as an American in Germany
Gallery
Germany's 17 Olympic gold medals in pictures
14 facts you never knew about the Brandenburg Gate
Society
Ten times Germans proved they really, really love beer
National
Six things you need to know when moving to Germany
Travel
These 10 little-known German towns are a must see
International
German scientists prove birds can sleep while flying
Technology
London v. Berlin: Which is better for startups?
Lifestyle
13 mortifying mistakes German learners always make
6,582
jobs available
Toytown Germany
Germany's English-speaking crowd