Germany May Reduce Coal-Fired Energy to Protect Climate

Germany is considering removing some of its coal plant capacity as part of a raft of new policies to help Europe's biggest economy meet its greenhouse gas emissions goals, a state secretary at the economy ministry said on Wednesday.

Chancellor Angela Merkel's cabinet is to decide on Dec. 3 on a programme that is likely to include steps to boost energy efficiency and possibly reduce coal generation, said Rainer Baake, a member of the Greens serving under Social Democrat Economy Minister Sigmar Gabriel.

The environment ministry has already warned Germany may miss its goal to cut greenhouse gas emissions by 40 percent by 2020 from 1990 levels. Germany is at risk of missing the target by between 5 and 8 percentage points, Baake said.

"It is our job to close this gap. It is my view that we will succeed. We are determined to do it," he told reporters.

Missing the goal would be an embarrassment for conservative Merkel, a former environment minister, who has made Germany's "Energiewende", a switch towards renewable energy sources away from nuclear power and fossil fuel, a pet project.

In an experiment that experts say is ambitious for an industrialised state, Merkel's government wants renewables to make up 40-45 percent of power generation by 2025 and 55-60 percent by 2035.

Although Germany has seen a boom in green energy, accounting for about 25 percent of overall power generation, environmentalists criticise Germany for its continued dependence on coal-fired plants, which made up about 45 percent of power generation last year.

"We are looking at whether it could be sensible to take a certain amount of coal power plant capacity out of the market and put it in a reserve," Baake said.

"These decisions have not been made ... The outcome is open," he said.

Earlier this month, Der Spiegel reported the government wanted to remove 10 gigawatts of coal-fired power generation, equivalent to around two dozen small power plants.

Baake said over time, the share of lignite, which is particularly damaging to the environment, would also come down but he stopped short of giving any timetable, which is what campaigners want.

"It will be a project that lasts several years, several decades. But fossil fuels will be reduced."

Germany's goals are more ambitious than those agreed last week by the European Union, which included a pledge to cut greenhouse gases by at least 40 percent in 2030.

Baake said no decision had been taken yet on the possible introduction of a capacity market, aimed at helping unprofitable conventional power plants when green energy is unavailable.

Utilities have pushed for such a mechanism amid fears that Germany could face power shortages during the switch to renewables. It would see the government raising funds to pay operators such as RWE and E.ON to keep open some of their power plants, many of which are loss-making.

The government will next week publish a "green book" outlining the main issues that will form the basis of a public consultation. A decision could be made next year, Baake said.

(By Madeline Chambers; Editing by Dale Hudson)