German Government Hesitates On Coal Phase-Out

  • Date: 03/08/16
  • Brian Parkin, Bloomberg

A policy document prepared for Chancellor Angela Merkel shows the German government is hesitating to set fixed coal-reduction targets ahead of national elections.

Even as the European Union’s biggest economy boasts the most installed green power on the continent, it also continues to emit the most greenhouse gas in the 28-nation bloc. That paradox is forcing Merkel, who’ll campaign for a fourth term in 2017, to manage political constituencies at odds with each other.

The four-page document from June was drafted by the chancellery following the Federal Environment Ministry’s advice Germany can meet its commitments to cut emissions. Minister Barbara Hendricks said in January that a coal phaseout could be possible by 2050. Now, according to the document seen by Bloomberg News, the government wants to postpone firm decisions on timing until after elections take place.

Germany is just at “the start point” of formulating its national strategy to comply with the Paris Accord, reads the document. Concrete policy moves such as mapping a shutdown of coal-fired power are “politically controversial” and need careful impact assessments, according to the paper.

A spokesman for the chancellery declined to comment on the climate plan.

Emission Targets

Merkel is facing conflicting economic forces that threaten to undermine initiatives to mitigate climate change. Hard coal and lignite plants owned by RWE AG and EON SE generated about 43 percent of Germany’s power last year. At the same time, investors including Allianz SE and Commerzbank AG have advocated for a speedy phase-out from coal.

The country has struggled to meet its pollution-reduction targets. Germany committed to cut carbon dioxide emissions by 40 percent in 2020 compared to 1990 levels but had managed just a 27 percent reduction at the end of last year. In the French capital in December, Germany signed up to cutting carbon pollution by as much as 95 percent by 2050 from 1990 levels.

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