Phasing Out Coal
The Energy Revolution
Working towards sustainable energy for the future: Germany wants to completely abandon coal mining by 2038, an ambitious goal with quite a few obstacles still blocking the way.
By Petra Schönhöfer
For centuries, mining and coal extraction have been as integral to Germany as the automobile industry is today. The Federal Republic of Germany is the biggest producer of lignite or brown coal in the world with a mining tradition dating back to the 17th century. For a long time, brown coal was considered a reliable source of electricity since it was cheap to mine and the reserves seemed practically inexhaustible. Today we know that brown coal reserves are by no means infinite and that getting them out of the ground causes massive environmental damage, destroying the landscape and emitting huge amounts of CO2.
At the latest since the Fukushima disaster put nuclear energy on the list of energy sources in dire need of replacement, the pressing need for an energy revolution has been clear. Germany signalled its willingness to shift its energy production by signing on to meet the goals set at the 2015 World Climate Conference in Paris. The “2050 Climate Protection Plan” adopted by the Federal Government in 2016, which includes reducing greenhouse gas emissions by at least 55 percent compared to 1990 levels, focuses on a complete phase out of coal. The targets have been set - but the path to meeting them still has to be blazed.
Phasing Out Coal by 2038
Politically, important steps have already been taken in the right direction. In 2018, the German government founded the Commission for Growth, Structural Change and Employment, known as the “Coal Commission” for short, to support progress towards its energy sector goals. Stakeholders from politics, the private sector, environmental organisations, unions and the states and regions affected worked together to draft a plan for phasing out coal and the accompanying structural changes this will require in Germany. The plan puts Germany on a course to be completely independent of coal-fired power plants by 2038 at the latest. 12.5 gigawatts from lignite and hard coal-fired power plants - around 28 percent of today’s coal-fired electricity production - are to be shut down by 2022, which would halve annual CO2 emissions in the electricity sector by 2030.
In September 2019, the Federal Government launched a comprehensive package of measures to implement the Commission’s goals. The ambitious bill underscores the federal government’s determination to achieve greenhouse neutrality by 2050. It is set to make rail travel cheaper, air travel more expensive, and to completely do away with oil furnaces in private homes. The largest single item in the 2030 climate protection programme though is the phasing out of coal-fired power generation - and the second largest is the expansion of renewable energies to 65 percent by 2030.
Weighing the Importance of Trees Versus Jobs
Despite the clear goals set, the energy revolution will not be easy. Phasing out coal is a social powder keg, and while opponents of brown coal push for quick action, resistance is strong in other segments of society. These tensions came to a head in Hambach Forest in 2018. The wooded area bordering the Etzweiler lignite mine in North Rhine-Westphalia was slated for open-cast mining. For weeks, hundreds of environmentalists and activists occupied the woods threatened by imminent deforestation, and tens of thousands of demonstrators from all over Germany came to show their support. At the same time, unions and workers from the brown coal industry are fighting to keep their jobs. The energy revolution is experiencing backlash in other regions, too, places where new wind farms are to be built, for example. Residents argue that the huge rotors cause noise pollution and threaten the environment and cultural assets, and have filed injunctions to try and stop wind farms springing up in their backyards. The approval process is basically at a standstill, blocking the urgently needed expansion of wind energy.
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Rising energy prices?
In the negotiations on phasing out coal, there have been frequent warnings about possible increases in the cost of energy. According to estimates by the Agora Energiewende think tank, this is only partially true. If coal is phased out in keeping with Coal Commission’s recommendations, then large consumers will be able to purchase their energy at a more favourable exchange price. In 2030, energy will be an estimated 0.5 cents cheaper per kilowatt-hour for them than before the coal phase-out. This doesn’t apply to private households though, who will have to pay roughly 0.4 cents per kilowatt-hour more than today. A three-person household that consumes 3,500 kilowatt-hours annually will probably have to spend around 1.20 euros more per month.
Photo (detail): © picture alliance/dpa-Zentralbild/ZB/Patrick Pleul
Structural assistance for affected regions
Three regions - the Rhenish, the Lusatian and the Central German districts - are still active in coal mining today. The future of these regions is a source of lively public discussion. The relative economic importance of lignite in both the Rhenish and Central German districts is comparatively low, since both regions have a diversified industry and a well-developed infrastructure. The industrial sector plays a much more central role in the structurally weaker Lusatian district, though. Here gross domestic product per capita is far below the German average and the region is more dependent on the manufacturing industry. The affected regions are to receive 40 billion euros in structural aid over the next 20 years to help them adapt to the upcoming structural changes. The funds will be used to improve the regional infrastructure to strengthen the public university and research landscape, for example.
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Renewable energy creating new jobs
Withdrawing from coal mining means the 19,000 jobs in brown coal will also disappear. This is a major issue in the public debate, where combatants often forget that a large part of the structural change in the coal industry has already taken place. In 1990, 127,600 people were directly employed in the lignite industry. At the same time, around 100,000 new jobs have been created in the renewable energy sector in past decades – in exactly those federal states most severely affected by the coal phase-out. Additionally, two thirds of the people currently still employed in the coal industry will be of retirement age by the time coal is completely phased out in 2038.
Hard Coal Phase-Out as a Model
In the heated debate, it is easy to lose sight of the significant progress that has already been made. In 2019, coal has already lost its dominance in the mix of energy sources used in Germany. A study by the Fraunhofer Institute for Solar Energy Systems, ISE, found that photovoltaics and wind were the largest sources of electricity in Germany, jointly producing more electricity than coal in the first half of 2019. Combined with water and biomass, renewable energy sources accounted for almost half of public net electricity generation. And hard coal has already been phased out as part of the ongoing energy transition. The last German colliery closed in Bottrop in December 2018, taking the largest hard coal mining areas off the grid. In its heyday, it employed more than half a million people and produced over 110 million tons of hard coal per year. Then coal lost its international competitive edge and recently more than one billion euros in coal subsidies per year were spent making up the price difference on the world market. So in 2007, the Bundestag decided on a timetable for phasing out the coal being mined at a loss. The RAG Foundation was formed the same year to handle regulated withdrawal from production and the lasting impact on the environment. The hard coal phase-out is regarded as a model because it was socially responsible, took environmental damage into account, and provided economic security.