The federal German government confirms its plan to shut down all of Germany's 84 coal-fired power plants by 2038 to meet its international commitments to combat climate change. These polluting plants account for 40% of Germany's electricity and are also major sources of revenue for states in eastern Germany that supply the lignite (or brown coal) that powers these plants.
The decision to close these plants was taken in January 2019 when a government coal commission ended seven months of tough negotiations with affected sectors of the economy such as the coal mining industry. The plan that sprang from these negotiations set aside $44.6 billion (40 billion Euros) to mitigate the pain in Germany's coal regions that would lose one of their biggest markets.
It calls for a quarter of Germany's coal-fired plants with a capacity of 12.5 gigawatts to be shut down by 2022. The result will be shutting down 24 plants within the first three years. By 2030, Germany should have only eight coal-fired power plants in operation producing 17 GW of electricity, according to the commission.
Environment Minister Svenja Schulze said eight "very old and very dirty" coal plants will be taken offline very quickly. The first such plant will be shut down this year.
Finance Minister Olaf Scholz said operators of coal-fired power plants will receive compensation for closing down their plants earlier than planned. Operators of plants in western Germany will receive $2.9 billion (2.6 billion Euros). Another $1.95 billion (1.75 billion Euros) will go to operators of plants in the east. The federal German government will make payments over 15 years after the plants are switched off.
The federal government has approved a plan to spend up to $44.6 billion (40 billion Euros) by 2038 to cushion the impact on coal-mining regions of abandoning the fossil fuel. That money will start being paid once the Bundestag (the German parliament) approves legislation setting out the dates and terms of Germany's exit from coal.
The government said reviews will be carried out in 2026 and 2029 to determine if Germany can exit coal-fired electricity generation in 2035, or three years before the final deadline.
"What we have here is a good agreement for climate protection because it makes clear that we mean it seriously," said Economy Minister Peter Altmaier. He added the government plans to bring legislation to the Bundestag at the end of this month.
Germany is also in the process of exiting atomic power. The last nuclear reactor will go offline at the end of 2022.
