Keeping Standby German Coal Plants Is Too Costly, Says Operator
(Bloomberg) -- A coal plant operator in Germany has warned that it’s unprofitable to put power stations on standby to help keep the lights on for the next few years, as requested by the nation’s regulator.
Steag GmbH has been asked to keep five coal plants with 2.5 gigawatts of capacity online until end of March 2031 to safeguard the power system in Europe’s biggest economy. The company lodged a complaint against the order, it said Thursday, citing the significant costs associated with such a move at a time when energy companies are supposed to be investing in cleaner fuel sources.
While Germany hopes to phase out coal entirely by 2030 — eight years before a legal deadline — many companies have warned it might not have enough alternative power sources by then to do so. This Sunday, it’s set to shut off seven plants and put several others back into reserve as a temporary permit to burn more of the dirty fossil fuel this winter expires.
At the peak of Europe’s energy crisis, Steag was asked to bring five of its coal plants back online amid fears that curbed gas flows from Russia could lead to blackouts. While they were supposed to cease operations at the end of this month, Germany’s Federal Network Agency recently classified the plants as “systemically relevant”, meaning that Steag can’t fully shut them down and must keep them operational.
While the decision is good for Germany’s energy security, “this model is not economically viable under the current rules,” Steag’s Chairman Andreas Reichel said.
The Federal Network Agency declined to comment on the company’s complaint.
In December, BNetzA also ordered Uniper SE and EnBW Energie Baden-Württemberg AG to keep plants in reserve that the companies had wanted to retire.
While the operator of a reserve plant can claim reimbursements from the grid operator, it is not allowed to participate in the regular energy markets. Germany also does not have a capacity market.
©2024 Bloomberg L.P.
KEEPING THE ENERGY INDUSTRY CONNECTED
Subscribe to our newsletter and get the best of Energy Connects directly to your inbox each week.
By subscribing, you agree to the processing of your personal data by dmg events as described in the Privacy Policy.
More utilities news
![BloomburgMedia_SH029YT1UM0W00_22-07-2024_06-24-28_638572032000000000.jpg](/media/kixlhdmg/bloomburgmedia_sh029yt1um0w00_22-07-2024_06-24-28_638572032000000000.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133661030689370000&format=webp)
China Greenlights Massive Offshore Wind Project for Shanghai
![BloomburgMedia_SGTHNUT0AFB400_19-07-2024_11-00-09_638569440000000000.jpg](/media/ykwdlzf1/bloomburgmedia_sgthnut0afb400_19-07-2024_11-00-09_638569440000000000.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133658604093100000&format=webp)
Germany Accused of Hoarding Gas Meant for Czech Republic
![BloomburgMedia_SGHC0KT0AFB400_20-07-2024_12-00-07_638570304000000000.jpg](/media/o0jfkgex/bloomburgmedia_sghc0kt0afb400_20-07-2024_12-00-07_638570304000000000.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133659504077430000&format=webp)
Sabesp Privatized in Year’s Biggest Latin America Stock Deal
![BloomburgMedia_SGRX9MDWLU6800_18-07-2024_13-22-56_638568576000000000.jpg](/media/vz3f0u2i/bloomburgmedia_sgrx9mdwlu6800_18-07-2024_13-22-56_638568576000000000.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133657825763030000&format=webp)
Wildfires Erupt in Canada Crude Patch in Threat to Oil Sands
![BloomburgMedia_SGP6PGDWX2PS00_17-07-2024_12-00-07_638567712000000000.jpg](/media/vv1os5oy/bloomburgmedia_sgp6pgdwx2ps00_17-07-2024_12-00-07_638567712000000000.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133656912072430000&format=webp)
SK Group to Merge Energy Units to Help Ailing Battery Business
![BloomburgMedia_SGPCY7DWRGG000_16-07-2024_12-00-07_638566848000000000.jpg](/media/e4spnknq/bloomburgmedia_sgpcy7dwrgg000_16-07-2024_12-00-07_638566848000000000.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133656048073530000&format=webp)
UK Water Watchdog Now Probing All Utilities on Sewage Spills
![MAR 9600](/media/qfxn3mb3/mar_9600.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133655881555500000&format=webp)
Enersol signs agreement to acquire a majority stake in NTS Amega
![BloomburgMedia_SGNCH4DWRGG000_15-07-2024_06-13-24_638565984000000000.jpg](/media/nska0lrh/bloomburgmedia_sgnch4dwrgg000_15-07-2024_06-13-24_638565984000000000.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133654976040970000&format=webp)
The World’s Power Grids Are Failing as the Planet Warms
![Audif1 Bp Showcar.Jpg.Img.1024.Medium](/media/qqhdotsq/audif1-bp-showcar-jpg-img-1024-medium.png?anchor=center&mode=crop&width=240&height=135&rnd=133655088561830000&format=webp)
Audi and BP partner for Formula 1 entry in 2026
![BloomburgMedia_SGHXQKDWLU6800_15-07-2024_06-23-53_638565984000000000.png](/media/w3ppn4mg/bloomburgmedia_sghxqkdwlu6800_15-07-2024_06-23-53_638565984000000000.png?anchor=center&mode=crop&width=240&height=135&rnd=133654982331000000&format=webp)
European Gas Prices Rise After Global Supply Risks Resurface
![CSIS Thumbnail](/media/o0acqjyg/csis_thumbnail.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133566075809700000&format=webp)
CSIS: long-term LNG demand to reshape global export capacity growth
![Dr Carole Nakhle Thumbnail](/media/gqrpjths/dr-carole-nakhle_thumbnail.png?anchor=center&mode=crop&width=540&height=300&rnd=133542056370600000&format=webp)
More women in energy vital to the industry’s success
![Vandana Hari Thumbnail](/media/gz3dyktl/vandana-hari-thumbnail.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133511540022930000&format=webp)
India’s energy sector presents lucrative opportunities for global companies
![OIL INDIA Thumbnail (1)](/media/oddlww2x/oil-india-thumbnail-1.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133506537128730000&format=webp)
Oil India charts the course to ambitious energy growth
![DNV Thumbnail](/media/chkphnjn/dnv-thumbnail.png?anchor=center&mode=crop&width=540&height=300&rnd=133491856590700000&format=webp)
Maritime sector is stepping up to the challenges of decarbonisation
Partner content
![Navigating the trading seas: exploring the significance of benchmarks-1859882229](/media/qlacaiww/navigating-the-trading-seas-exploring-the-significance-of-benchmarks-1859882229.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133613577584600000&format=webp)
Navigating the trading seas: exploring the significance of benchmarks
![New Lng Ship Web 17829](/media/vjrjyypa/new-lng-ship-web-17829.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133179936218300000&format=webp)
Back to the Future(s): the best commodities benchmarks are still physically settled
![Dr Klaus](/media/4eyh2dr0/dr-klaus.jpg?center=0.3953747239980292,0.50683017007953435&mode=crop&width=540&height=300&rnd=133517897092430000&format=webp)
Ebara Elliott Energy offers a range of products for a sustainable energy economy
![ESSAR](/media/5uafghtj/essar.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133524466961070000&format=webp)
Essar outlines how its CBM contribution is bolstering for India’s energy landscape
![HNC 7611 V2](/media/0dqbya15/hnc_7611_v2.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133517899616530000&format=webp)