Guide: The Swedish utility Vattenfall wants to shut down its youngest and most efficient coal-fired power plant in Germany because it is unprofitable.
The Swedish utility company Vattenfall wants to shut down its youngest and most efficient coal-fired power plant in Germany because the plant is unprofitable.
After participating in the first bid for the elimination of hard coal, CEO Magnus Hall said that if his company’s bid is successful, the 1.6 GW Moorburg power plant in Hamburg will be partially or completely suspended by the middle of next year. .
Hamburg's Moorburg coal-fired power plant has a capacity of 1.6 GW. After years of efforts with local environmental organizations, it started operation in 2015.
Hall said that the Moorburg plant has (partially or fully) participated in the first hard coal power plant shutdown premium bid, which is part of the German coal export plan and will shut down the operation of the plant. If the bidding is successful, it will be conducted in mid-2021.
"This is a difficult decision because it is a young and efficient power plant," "But if you suffer a loss, you must take some measures."
According to Vattenfall, the plant emitted 4.7 million tons of carbon dioxide last year and can continue to operate until 2038. But the company's goal is to stop using fossil fuels, including coal, by 2030.
The head of Greenpeace Germany, Martin Kaiser, said that Hall’s remarks indicate that hard coal is “dead economically and politically”.
Germany’s first round of hard coal phase-out tenders aims to reduce power generation capacity by approximately 4 GW. The results will be announced in December.
Under the closure plan, the utility company considered their expected future earnings and offered how much they would be willing to stop the operation of their factories.
The Federal Network Administration (BNetzA) organizes the auction.
A spokesperson told Clean Energy Wire that from January 2021, successful bidders in the first round of auctions will be prohibited from selling electricity on the market.
Then, starting from July-the date mentioned in the Hall of Vattenfall, they are forbidden to burn coal.
However, in order to ensure the safety of the grid, the transmission grid operator will determine which of the winning power plants may be critical to the entire power system.
A spokesperson for said: "If the winning equipment is deemed essential to the system, it will not be completely decommissioned, but will be moved to a grid backup station to ensure grid safety."
Lower wholesale electricity prices and higher CO2 emission prices make many coal-fired power plants unprofitable.
Although Moorburg is one of the newest factories in Germany, it has been fighting the local opposition since it started operations and accused it of being outdated.
In 2019, the plan to connect it to the local heating network failed because it did not meet Hamburg's goal of phasing out coal for heating production by 2030.
Germany plans to phase out the use of coal by 2038.
The country’s parliament approved legislation in July 2020, setting out a timetable for shutting down lignite power plants, paying compensation to operators, and conducting auctions for hard coal power plant operators to withdraw their capacity from the grid.
The phasing out of coal is part of Germany’s efforts to achieve greenhouse gas neutralization by the middle of this century.
According to estimates by the Federal Environment Agency (UBA), since 1990, the carbon dioxide emissions of Germany's electricity structure have fallen by 47%.