The German government recently approved a plan with a total value of 4.3 billion euros, increasing the compensation for utility companies that phase out hard coal power stations.

According to the newly announced plan, the German utility company will transform its hard coal power plant into a natural gas power plant, and will receive a compensation of 390 euros per kilowatt installed capacity. This scheme is suitable for hard coal power stations with a service life of not more than 25 years, and is valid until the end of 2022. Hard coal power stations with a service life of between 25 and 35 years will receive a compensation of 225 euros per kilowatt if they switch to natural gas.

Previously, the German government had been negotiating the compensation for hard coal power plant transformation, which was 180 euros per kilowatt installed.

The new plan also stipulates that if the utility company decides to convert its hard coal power plant to natural gas after 2022, the compensation received will be reduced by 25 euros per kilowatt per year. The German government hopes to use this move to attract utilities that have not switched to natural gas to shut down their hard coal power plants.

It is understood that Germany previously proposed that after 2026, all hard coal power stations will be closed for free; by 2033, it will completely get rid of hard coal power generation; by 2038, coal will be eliminated.