Today, the Federal Cabinet adopted the wording advice on the hard-coal related aspects of the (in German) by means of a written circulation procedure. This means that the text is now ready to be adopted by the Bundestag and Bundesrat this week.
Said : “I’m happy to announce that we have now found a viable compromise on hard coal, too. The wording advice that has now been adopted by the Cabinet includes the changes made in the course of the parliamentary debate. An additional round of auctions will take place for 2027. The gradual decrease of the coal-replacement premium for CHP installations is yet another incentive for operators to bring forward the retrofitting work on their coal-fired power plants. We are also enshrining the 65% target for renewables in our legislation, thus showing how we want to replace the electricity that will no longer be generated from coal in the future. This gives everyone involved in the market the certainty they need to plan ahead.”
The wording advice regarding hard coal complements last week’s wording advice on lignite. The key points of today’s advice on hard coal are the following:
- An additional round of auctions for coal-fired power plants using hard coal has been introduced (target year 2027) and the maximum prices for the target years 2024-2026 increased. A new programme has been launched to support forms of heat generation and use that do not generate greenhouse gases.
- The Combined Heat and Power Act will be amended to increase the basic funding rate for large CHP installations by 0.5 ct/KWh as of 2023. The amount of the coal-replacement premium will be calculated based on the installation’s age. The coal-replacement premium for installations that began operating after 1984 will be increased by a considerable margin. By the same token, older installations will receive a lower premium and very old installations will receive none at all. The bonus will also decrease with time, creating an incentive for early retirement of the power plants. Nothing will change for those installations for which an advance decision has already been issued. Under a new rule facilitating the transition between the old and new legislation, the number of hours for which funding can be claimed will be gradually brought down.
- The Renewable Energy Sources Act will be amended to include a 65% target for renewables in Germany’s gross electricity consumption by 2030.