Conventional power axed in Germany

2013-08-18 13:53
Nuclear plant.

Nuclear plant. (AP)

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Berlin - German power company RWE is shutting six domestic plants and rival E.ON is threatening to relocate to Turkey as the sector tots up the cost of the government's energy policy turnaround.

Ever since Chancellor Angela Merkel announced a phase-out of nuclear energy over the next decade and pledged to generate as much as 80% of the country's electricity from renewables by 2050, big question marks have been hanging over the future of coal and gas-fired plants in Germany.

Merkel, seeking a third term in general elections on 22 September, is a staunch supporter of this hugely popular policy move.

But the turnaround is depriving utilities, including market leaders RWE and E.ON, of massive profits from their atomic plants and turning their gas and coal-fired stations into loss-makers as they are sidelined by rival renewable sources of energy.

Last week, the two biggest players in the German sector unveiled steep drops in profits, and "many of our plants are operating at a loss," complained RWE's finance chief Bernhard Guenther.

Indeed, RWE announced that it would shut down a number of plants - representing combined capacity of 4 300 megawatts - in both Germany and the Netherlands. And more could follow, Guenther warned.

The networks agency that oversees such closures has received 15 such applications since the end of 2012, according to a spokesperson.

It was not immediately clear whether RWE's plants were part of the number, but Norway's Statkraft for one has also announced plans to pull the plug on two sites in Germany.

With political clout firmly behind renewables, priority is given in the national power grid to so-called "clean" electricity, which means that all power generated from wind turbines or solar panels is pumped into the grid, while that produced by coal and gas-fired plants is used simply to make up for any shortfalls.

Read more on:    germany  |  renewable energy

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