Germany Is Burning Too Much Coal

Nov 15, 2017

Germany is widely seen as a world leader in the fight against climate change. Thanks to its investments in renewable power, wind and solar energy provide a third of its electricity, more than double the U.S. share.

Germany's goal to lower carbon-dioxide emissions 40 percent by 2020 is significantly more ambitious than that of Europe as a whole or the U.S.

After the U.S. withdrawal from the Paris climate accord, Chancellor Angela Merkel vowed even greater determination. "We can't wait for the last man on Earth to be convinced by the scientific evidence for climate change," she explained.

But there's another, troubling side to the German story: The country still gets 40 percent of its energy from coal, a bigger share than most other European countries. And much of it is lignite, the dirtiest kind of coal. As a result, Germany is set to fall well short of its 2020 goal.

Lignite from pit to smokestack. Photographer: Martin Leissl/Bloomberg

This dependence on coal is partly a side effect of Germany's abandonment of emissions-free nuclear power and partly foot-dragging on the part of a government wary of alienating voters in German coal country. During the summer election campaign, Merkel largely avoided the subject.

Suddenly, though, the politics have changed. Merkel is struggling to form a new government, and the Green Party, one of three would-be coalition partners, is insisting that coal-fired power plants start to close -- the 20 dirtiest ones right away. This wouldn't solve the problem, but it would put Germany on a path to serious emissions reductions, and it's the only way to bring that 2020 emissions target back in sight. To live up to the claims she's been making, Merkel should deliver these closures.

It's not just the political moment that's right. German unemployment is at a record low, and thousands of new jobs have opened in renewable energy -- making this a good time to help affected coal miners and coal-plant workers move into other kinds of work. The power market, for its part, is oversupplied, so a loss of coal plants would not appreciably raise the price of electricity for consumers in the short term.

Looking ahead, the best way to ensure that coal-fired electricity plants keep closing is a rising price of carbon. On that front, there is good news: Promised reforms to the European Union's cap-and-trade system would shrink its chronic oversupply of emissions permits. By 2020, according to an analysis by Bloomberg New Energy Finance, this should triple the price of carbon to 24 euros a ton -- high enough to push all European countries away from coal.

If Merkel acts on the proposal to close those lignite-powered plants, she'll give this overdue shift some fresh momentum.


- Bloomberg

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