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Coal power plants in EU shuttering amid jump in expenses from end-June

Coal power plants in EU shuttering

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Published

June 25, 2020

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Published:

June 25, 2020

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Exemptions in air pollution limits in the EU are about to be abolished, so owners of older coal-fired power plants will have fewer operational hours allowed. Another option, aside from closing the facilities, is to invest in efficiency and environmental protection, but with little to no guarantee it would be cost effective.

While ČEZ is preparing to take offline the remaining four blocks at its Prunéřov I thermal power plant on June 30, a large group of such facilities throughout the European Union are destined to go out of business as well. Europe Beyond Coal noted exemptions from EU air pollution limits expire at the end of the second quarter and that Spain is leading the pack with the upcoming closure of eight coal power plants with 5.16 GW in total capacity. It is more than half of the total in the country.

The long-planned change in rules means if operators don’t want to dismantle the facilities that use older technology, they must either opt for expensive retrofits, with uncertain results regarding profitability, or reduce operational hours. The latter would boost the cost of keeping a facility running while income would be slashed.

Poland so far decided to shut down two units of Patnow I, with 600 MW in total, and to give up on Ostrołęka C, its last thermal power plant project on coal. However, it quickly has to make more stark choices, the statement adds.

Resistance to shutdowns is fading

The Czech Republic and Slovakia may be forced to close units, the environmentalist group warned. The Czech Prunéřov I system has 440 MW. Spain scheduled the shutdown of two more facilities by 2022 and one by 2025, while another is seen for closure without a timeline yet. It would leave the country with only two coal power plants.

Spain has only two coal power plants without plans for closing or a switch to other fuels

“For too long, huge amounts of public and private money has been poured into Spain’s failing coal plants, while coal workers have been left worrying about their livelihoods,” said Carlota Ruiz-Bautista, environmental lawyer at the International Institute for Law and the Environment (IIDMA) in Madrid. “Crucially, the Spanish government realized that coal plant closures were unavoidable, and that it needed to act, so it began working with stakeholders in 2018. Now that the regional just transition agreements are being developed, nobody should be left behind, and resistance to the closures is fading.”

Germany, Poland asleep at wheel

Spain’s hard coal mining sector underwent a similar collapse in December 2018 when EU rules on state aid obliged 26 mines in receipt of state subsidies to either close or give back the money they’d received. The majority opted to shut as they were no longer profitable.

“The German and Polish governments are asleep at the wheel. As the Czech coal commission prepares its recommendations for a Czech coal phaseout, it should look to Spain’s proactive example, and be wary of Germany’s foot-dragging. Bowing to pressure from coal companies will do nothing but put taxpayers on the hook for undue compensation, risk people’s health, lead coal workers into a dead end, and exacerbate the climate crisis,” said Zala Primc, Europe Beyond Coal campaigner.

European Green Deal

Coal, once the cornerstone of EU integration together with steel, was reduced to a fifth of output in all power plants. There are 230,000 people employed in the sector in 31 regions and 11 countries. As the European Green Deal is paving the way for a transition to cleaner energy and a reduction in greenhouse gas emissions, planners in Brussels introduced the Just Transition Mechanism.

The Just Transition Mechanism is valued at EUR 100 billion

Within it, the EUR 40 billion Just Transition Fund is envisaged for making sure no one is left behind. The wider scheme should be worth EUR 100 billion. It is planned to include EUR 1.5 billion in grants and EUR 10 billion in loans from the European Investment Bank as well as the mobilization of as much as EUR 30 billion for decarbonization.

Platform for Coal Regions in Transition

As part of the initiative, the Platform for Coal Regions in Transition works as an open forum, gathering all relevant parties, local, regional and national governments, businesses and trade unions, NGOs and academia. There are 20 coal regions currently involved. They are in Poland, Germany, Czechia, Romania, Greece, Slovenia, Slovakia, Spain, and Ireland.

Information gathered by Europe Beyond Coal only since the beginning of May shows companies in the EU have revealed plans for closure or the switch to other fuels for five active coal power plants.

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