Balancing Act Coal commission calls for surge in investment to offset coal phaseout

The commission tasked with finding ways to quit coal-fired power in Germany listed suggestions for helping affected regions, which include massive investments and a warning that federal aid pledged is not enough.
Employment guarantees? Think again.

Germany's coal commission, a panel of politicians and energy experts set up by the government to help organize the phaseout of coal-fired power generation, recommended massive investment in the regions that will be hit. They warn that failure to do so could cause social upheaval, especially in the former communist east.

The report, seen by Handelsblatt, provides a detailed list of possible infrastructure and renewable energy projects to offset the blow of quitting coal in eastern mining regions and the western Ruhr valley.

Furthermore, the €1.5 billion ($1.7 billion) that the government set aside for structural development in the current four-year parliamentary term could only be “a first step.” That money should rather be made available to the affected regions immediately, according to the report.

Worries about the former East

Just last week, the eastern states alone — Saxony, Saxony-Anhalt and Brandenburg — demanded €60 billion in federal aid to cover the phaseout of lignite mining.

Although Germany’s mining sector is relatively small and employs just 21,000 people — 11,000 in the east — the phaseout is a hot-button issue. There are fears that job losses could boost support for the far right in affected regions, especially in the east where coal is the main industry in some parts.

The Alternative for Germany party, the leading opposition party, has garnered support in those regions by questioning whether humans are accelerating global warming. Germany still produces over a third of its electricity from burning coal, one of the dirtiest fossil fuels, and the government admitted in August that it would fail to meet its target to cut carbon emissions to 40 percent of 1990 levels by 2020.

The commission, which is also drafting a timetable for exiting coal, said structural funds shouldn’t just go towards economic projects but also into measures “to develop civil society activities, quality of life and soft location factors.”

It said a successful structural policy could help safeguard the liberal democratic order in the east, which saw the worst neo-Nazi rioting in a generation in the town of Chemnitz in August.

More than 30,000 miners, coal power station employees and industrial workers protested against the phaseout and job security in Bergheim, near Cologne in western Germany, where the commission met for discussions Wednesday. And power station operators Uniper and Steag warned against rapid cutbacks in coal, saying it would make Germany vulnerable to power outages.

Concrete ideas by region

In the report, the commission said the Lusatia mining region along the border with Poland could remain an important location for the energy industry. They suggested a gas-fired power station be built there along with plants that covert wind and solar power into synthetic fuels.

For the western Ruhr region, it proposed establishing a research and industry campus for low CO2 technologies for energy-intensive industries. The commission also recommended investing in the rail network and in fiber-optic networks. The report also calls on federal and regional governments to locate public bodies in the affected regions whenever opportunities arise.

The meeting coincided with a call by researchers for Germany to exit coal-fired power by 2030 to comply with UN plans to limit global warming to 1.5 degrees. Think tank Climate Analytics said Germany needs to reduce CO2 emissions from coal generation by 42 percent from 2017 levels in less than two years and to zero by 2030.

The coal commission's report on structural change is due to be finalized on Thursday with the second part on a proposed timetable for quitting coal following in December.

Klaus Stratmann covers energy policy and politics for Handelsblatt. To contact the author: [email protected]