The German government is expected to adopt a regulation on 13 July that would allow operators of some hard coal plants temporarily to reactivate their units to help reduce natural gas consumption in the power sector, reports Tagesspiegel Background. Coal plants, which had successfully applied in phase-out tenders under the country’s coal exit scheme to stop producing electricity by 2022 or 2023, could thus return to the market as soon as the regulation takes effect, according to economy ministry sources. In addition, hard coal-fired and oil fired power plants that are already in the grid reserve would also be able to return to the grid. According to the draft regulation, operators must ensure that plants are technically restored to a condition that allows them to operate permanently on the electricity market, with the costs incurred being reimbursed. The scheme is temporary, and would end on 30 April 2023. Operators are free to decide whether they want to reactivate the plants, but in view of high power prices, experts expect them to do so.
The economy ministry is also preparing a similar regulation for lignite power plants, which can only participate in the market if the capacity of hard coal and oil power plants is insufficient to replace gas in the power sector. This includes lignite plants from the security standby, which for now may only be restarted in extreme emergencies.
Other measures
The German government has taken several steps in the past week in response to the emergency situation created by Russia’s invasion of Ukraine and the potential damage to climate change mitigation measures, as reported by Online business analyst Clean Energy Wire.
On 5 July it announced its intention to amend legislation that would allow the state to take stakes in companies severely affected by rising costs of imported fossil gas, such as Europe’s largest importer of Russian gas, Uniper. The cabinet adopted draft bills which now have to be debated and decided by parliament. The energy crisis, exacerbated by Russia’s war against Ukraine, means that some German energy companies crucial to supply security are struggling. Possible state support for Uniper – Europe’s largest buyer of Russian fossil gas – is generally considered the right solution because an insolvency would trigger a domino effect and shake up the entire German gas industry.
The government intends also to amend its energy transition laws to weaken its 2035 renewables target. The ruling coalition parties have dropped the target of ‘near 100 % renewables in the power grid by 2035’ but agreed on more favourable conditions for solar PV and strict wind power expansion targets for laggard states in their final negotiations on the country’s landmark 2022 energy transition reforms.
Now Germany is facing uncertainty over Russian gas supplies as Nord Steam maintenance starts. On 11 July Gazprom halted flows almost entirely through the Nord Stream pipeline as ten days of planned maintenance work began. The German government is bracing itself for a potentially permanent halt or reduction of supplies. The maintenance of the pipeline, which directly connects Russia and Germany, is performed around the same time every year. Once the work is done, gas flows could resume, but it is also possible, stated economy minister Robert Habeck, that Russia will make a political decision to halt supplies permanently. “It’s simply a situation like we haven't had before. Everything is possible,” said Habeck. Germany must ‘prepare for the worst’ and at the same time ‘work towards the best,’ he added. And this could lead, he said, to severe shortages next winter.
