Bulk of German government’s coal support spent on transition - study

The largest part of Germany’s government support to coal and coal-fired power production and consumption goes to measures focusing on the transition away from the fossil fuel, according to a study conducted by the Overseas Development Institute (ODI). In 2016-2017, Germany provided fiscal support for coal-fired power consumption by industry of about 172 million euros annually via tax reliefs, writes ODI, but spent almost 2 billion euros per year on transition support. The report also highlights that Germany stopped supporting hard coal mining at the end of 2018. The full report looks at the situation in all G20 countries. ODI found that, overall, the G20 countries’ support for coal power plants doubled in three years, despite their pledge a decade ago to phase out subsidies to all fossil fuels.

Germany has officially set in motion a gradual withdrawal from coal, joining other major economies in a global farewell to the climate-damaging fossil fuel. The coal commission recommended shutting down the last coal-fired power plant by 2038 at the latest. The phase-out is expected to cause billions of euros in costs for the public, as the country’s coal exit commission agreed on far-reaching measures to financially assist the affected regions and coal workers and to invest in dozens of infrastructure and training projects. The government has said it aims to maintain the mining areas as “energy regions” and to develop corresponding infrastructure for the production and storage of energy from renewable sources. Chancellor Angela Merkel's government coalition has to decide how to implement the non-binding proposal and draft the necessary legislation. Many details have yet to be worked out and ultimately decided upon by parliamentarians in a process that could drag on into 2020.