Germany's planned auctions for backup gas power plants delayed by one year – media report

Germany's highly anticipated government strategy for constructing gas power plants as a backup for rapidly increasing renewable generation will be delayed by one year, news magazine Der Spiegel reported. The government plans to auction 5 gigawatts (GW) of capacity in 2025 and another 5 GW in 2026, according to the article. Bidders for the construction of the gas plants - which are meant to run on green hydrogen at a later stage - can apply for support under EU guidelines. The date for the conversion to hydrogen has not been decided yet, but this step will likely be planned for the first half of the 2030s, Der Spiegel said. The government will officially announce details on its delayed "power plant strategy" by the middle of next week, the magazine said. Negotiations with the EU over support conditions took longer than expected, but all technical questions have now been answered, according to the article. The still-unresolved hydrogen conversion date, key for deciding whether the investments can be classified as decarbonisation measures rather than supply security provisions, had reportedly played a major role in the talks. The government initially planned to hold the first auctions in mid-2024.

The energy industry and other stakeholders had warned that a delay of the power plant strategy could significantly impair progress in several energy transition areas and could ultimately annul the planned 2030 phase-out of coal-fired power production agreed for western Germany. The country’s entire coal plant fleet still provides about 28 GW in secure capacity which has to be replaced with alternative sources. The back-up plants are necessary to complement intermittent renewable power production, which in the long run is supposed to happen purely with green hydrogen and power storage capacity, for example in industry-scale batteries.