# Back to black? Germany’s coal power plan hits hurdles Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-07-25 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: Germany's Electricity Production Challenges Amid Coal Meta Description: Discover how high coal prices, supply bottlenecks, and aged plants are impacting Germany's electricity production plans amidst gas delivery decline. URL: https://financedigest.com/back-to-black-germanys-coal-power-plan-hits-hurdleshtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2022-07-25t180912z3lynxmpei6o0tlrtroptp4ukraine-crisis-germany-coal-1736815543830-compressed.jpg) By Markus Wacket and Matthias Inverardi BERLIN (Reuters) – High coal prices, supply bottlenecks and aged plants are posing a challenge to Germany’s plan to increase electricity production from hard coal-fired power plants to compensate for declining gas deliveries, according to operators and industry experts. Earlier this month, Germany agreed to allow the reactivation of coal-fired power plants or an extension to their lifespans as it braces for falling Russian supplies of gas. Gas [accounts for about 6% of the country’s](https://www.financedigest.com/5-countries-you-need-to-have-an-offshore-account-in.html "5 Countries You Need To Have An Offshore Account In") electricity output. According to rough estimates, the move could compensate for 1% to 2% of Germany’s gas consumption, but [energy operators have either declined to reactivate plants or are facing](https://www.financedigest.com/explainer-why-europe-faces-climbing-energy-bills.html "Explainer-Why Europe faces climbing energy bills") difficulties in acquiring the necessary coal. Germany’s [energy regulator](https://www.financedigest.com/uk-energy-regulator-drops-plan-to-ring-fence-customers-cash.html "UK energy regulator drops plan to ring fence customers’ cash") told Reuters operators had so far notified it about reconnecting only one of the 16 coal-fired plants that Berlin hopes to see reactivated. The economy ministry said it was in [talks with operators and associations and was monitoring the coal](https://www.financedigest.com/britain-tells-climate-talks-coal-era-ending-as-carbon-emissions-surge.html "Britain tells climate talks coal era ending as carbon emissions surge") power situation closely. [Half of the 16 coal-fired plants on the government](https://www.financedigest.com/european-governments-spend-half-a-trillion-euros-on-energy-crisis-report.html "European governments spend half a trillion euros on energy crisis – report") list for reactivation or extension are operated by utility EnBW in southern Germany, but the company said the plants could not be reconnected to the grid due to their age. EnBW will, however, extend the life of one plant that was [due to be shut](https://www.financedigest.com/equinor-shuts-output-at-statfjord-a-platform-due-to-leakage.html "Equinor shuts output at Statfjord A platform due to leakage") in October, it said. Uniper, which has plants on the government’s list, said it had not yet decided on potential reactivations, while chemicals [group Evonik said it would put a plant in the western town of Marl back](https://www.financedigest.com/shareholder-group-iss-backs-barclays-board-over-former-ceo-staley.html "Shareholder group ISS backs Barclays board over former CEO Staley") into operation, but only in autumn. We hired staff, bought coal on the [world market](https://www.financedigest.com/world-stocks-slip-as-markets-await-u-s-midterms-outcome.html "World stocks slip as markets await U.S. midterms outcome") and took care of the technical maintenance,” an Evonik spokesperson said. Hard coal generator Steag plans to reactive its plants but is facing supply problems as the coal required would be a “not inconsiderable burden” on the company’s liquidity, a spokesperson said, adding it would cost a mid three-digit [million euros](https://www.financedigest.com/germanys-merck-to-invest-300-million-euros-in-us-gas-plant.html "Germany’s Merck to invest 300 million euros in US gas plant"). Higher electricity prices are incentivising energy operators to [consider going back](https://www.financedigest.com/3-options-to-consider-when-you-owe-the-irs-back-taxes.html "3 Options to Consider When You Owe The IRS Back Taxes") to coal, but coal prices have risen sharply and companies have to make advance payment for supplies. Inland shipping through rivers has been hampered by low water levels forcing ships to carry only half of their capacity, and [grain shipments from Ukraine](https://www.financedigest.com/traders-cut-ukraine-2022-combined-grain-and-oilseeds-crop-forecast.html "Traders cut Ukraine 2022 combined grain and oilseeds crop forecast") are straining the rail network, Germany’s coal importers association told Reuters. The association said coal transport bottlenecks would increase, especially from September when monthly import volumes are [expected to rise](https://www.financedigest.com/instant-view-us-may-payrolls-rise-up-than-expected.html "Instant View: US May payrolls rise up than expected") significantly. (Reporting by Markus Wacket and Matthias Inverardi; Writing Riham Alkousaa; Editing by Mark Potter) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---