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German government, states agree on coal phaseout

Gero Rueter im
January 16, 2020

Germany is hoping to phase out its coal-fired power plants by 2038 as part of its transition to a carbon-free economy. Here are the most important facts you need to know about Germany's exit from brown coal.

A stop sign in the foreground, while a coal power plant in the background spews out smoke
Image: imago/photothek

1. Why are we even discussing a coal phaseout?

Since the beginning of industrialization, the Earth's temperature has increased by 1 degree Celsius. One of the leading causes is carbon dioxide (CO2), which is produced by burning coal, oil and gas. It accumulates in the Earth's atmosphere, causing the greenhouse effect, leading to global warming.

If we continue to burn these fossil fuels, the Earth's temperature is projected to rise by around 4 degrees Celsius by the end of this century and by more than 7 degrees by the year 2200. Civilization as we know it would probably not survive such a dramatic increase in temperature.

The famous Paris Agreement aims to prevent this, stating that temperatures should not rise above 2 degrees — or better still, 1.5 degrees.

Read more: Coal dilemma: Will Germany blow its CO2 budget?

But to achieve this goal, reports by the Intergovernmental Panel on Climate Change (IPCC) and other UN agencies warn we can't afford to waste time. By 2030, global greenhouse gas emissions need to be halved, and we should be aiming for zero emissions by 2050.

Developing technology that allows for a quick fix of the problem is wishful thinking say climatologists, who warn that removing greenhouse gases from the atmosphere will require controversial and expensive techniques. It's much cheaper and safer to stop producing CO2 all together.

Infografik Treibhausgase Entwicklung EN

2. Why focus on coal and not other fossil fuels?

Coal is far more damaging to the climate than oil and gas and our electricity demands can now easily be covered with solar and wind power.

According to the German Advisory Council on the Environment (SRU), the last coal-fired power plant could be shut down in 2033 if we were to rapidly make the switch to renewables. We would probably still reach the 2-degree target. And shutting down coal power plants wouldn't endanger the power supply, they say.

But if we want to meet the 1.5-degree target, we would need to make the switch much sooner.

Read more: Germany: Renewables overtake coal as main power source

3. What exactly does Germany's coal commission do? 

In 2010 the German government adopted targets towards reducing greenhouse gases. In 2015, the global community came together in Paris to lay down a more ambitious goal of limiting global warming to 1.5 — 2 degrees.

Germany ratified the UN agreement, but it has not yet increased its climate protection targets to match what was agreed on in Paris.

In June 2018, the government created the Commission on Growth, Structural Change and Employment. Its job was to prepare proposals addressing carbon emissions and climate protection and also provide future perspectives for regions most affected by the coal phaseout.

An infographic showing the number of jobs in Germany's energy sector according to energy type. Wind power is the highest, employing 160,000 people, while hydropower is the lowest at 7,000. Brown coal and hard coal employs 20,000 and 13,000 people, respectively.

Approximately 20,000 people are employed in Germany's lignite industry — of which 15,000 work in open-pit mines and 5,000 in lignite power plants. The country's last active black coal mine closed in 2018, but more than 5,000 people still work in coal-fired power plants.

The importance of coal in Germany has diminished over the years. In 1960 as many as half a million people worked in black coal mines, while 150,000 worked in brown coal mining.

This structural change is also reflected in the growing number of employees in the renewable energy sector. According to the latest figures from 2016, it employs around 280,000 people.

Read more: How workers prepare ahead of Germany's brown coal phaseout

4. How expensive is Germany's coal phaseout?

German federal states with an active coal industry are demanding compensation from the government to finance structural change. The coal commission recommended that €40 billion ($45 billion) in aid be paid to affected states over the next few years. That amounts to an average subsidy of €2 million per job lost in the sector.

The money will be used to finance socially responsible solutions for workers, such as new jobs and new infrastructure projects, as well as possibly providing compensation to affected companies.

Germany is planning to complete its coal phaseout by 2038.

An infographic explaining how much different kinds of electricity costs in Germany. Onshore wind power is by far the cheapest, while hard coal and brown coal is the most expensive.

But the coal exit will not only result in monetary costs. It would also mean that entire villages would not need to be demolished and its residents resettled to make way for a coal mine.

Money could even be saved as air pollution is being significantly reduced. According to Germany's Environment Agency, the emission of air pollutants from Germany's coal-fired power plants last year alone amounted to over €150 billion in long-term damages.

Other consequences — such as an increase in extreme weather — are already beginning to be felt and will be mostly endured by young people and their children.

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