Energy policy: Habeck still wants to pass the law on power plants

Economics Minister Robert Habeck (Greens) wants to pass a law to fund new gas power plants worth billions before the new elections planned for February through the Bundestag and Bundesrat. The ministry submitted a corresponding draft law to the departmental vote of the red-green minority government, as ministry circles said. The law offers the short-term possibility of putting the construction of new power plants out to tender. This opportunity should be seized. The regulations are urgent.

The new power plants are intended to step in in the future if the electricity demand cannot be met by renewable energies. In addition, the switch to more climate-friendly hydrogen should be promoted.

A cabinet decision is expected on December 4th. However, the government no longer has a majority in the Bundestag. Union parliamentary group vice-president Jens Spahn (CDU) does not want to negotiate the construction of new gas power plants, as he told “Zeit Online”. Habeck’s concept falls far short. Spahn also reiterated his desire for a return to nuclear energy.

If the law fails to pass before the new election, this could mean months of delays. The ministry’s goal is that the first calls for tender should actually take place in the first half of 2025. The first new power plants are scheduled to go into operation in 2030. These goals would then no longer be achievable. New discussions with the EU Commission would then be necessary, whose approval is required.

Renewable systems, primarily from wind and solar, are to be massively expanded by 2030. This plays a central role in achieving climate goals. The goal is: 80 percent of electricity should come from renewable energy sources by 2030. Currently it is around 56 percent. But green electricity systems are volatile. That’s why back-up power plants are planned, which will later be converted to hydrogen. Energy companies have so far shied away from investing because new power plants are not easily profitable.

The federal government is planning billions in funding for gas power plants that can be converted to hydrogen, power plants that run on hydrogen from the start, and long-term electricity storage. The ministry estimates the costs at around 17 billion euros over a period from 2029 to 2045. The majority of the funds will come from the Climate and Transformation Fund, a special federal fund. A levy is also planned. Due to the distribution of the costs over a very long period of time, it can be assumed that there will be a “negligible additional burden” on citizens and the economy, according to the draft law.

Schedule for the coal phase-out

If there are delays in the so-called Power Plant Safety Act, the schedule for the coal phase-out would also be unstable. The new gas power plants are intended to replace coal-fired power plants. So far, an eight-year phase-out to 2030 has only been decided in the Rhenish district. Habeck expects an early, market-driven coal phase-out in East Germany too. The background is rising CO2 prices. This could make coal-fired power plants increasingly unprofitable.