(BN) Merkel Closes Door Left Ajar to Operate Coal Mines Beyond 2018


Merkel Closes Door Left Ajar to Operate Coal Mines Beyond 2018
2010-11-17 12:24:14.581 GMT

By Brian Parkin
Nov. 17 (Bloomberg) -- Chancellor Angela Merkel's
Cabinet agreed to close a legal loophole that would allow
Germany's subsidized coal mines to operate beyond a planned
phase-out in 2018.
The Cabinet today endorsed a bill that will annul a phase-
out amendment, passed in 2007 when Merkel ruled with the Social
Democrats. The SPD sought to keep the mines open in case Germany
ramped up coal-fired power generation as nuclear plants shut
down. The Free Democrats, Merkel's allies since 2009, say the
step is a potential waste of taxpayers' money.
"It's important to me that there won't be a reversal of
the phase-out," Free Democrat Economy Minister Rainer Bruederle
said in a statement after the Cabinet meeting in Berlin. "This
new bill will ensure that the phase-out of subsidized coal in
2018 is irreversible. That's good news for German taxpayers."
In July, Merkel rejected a European Commission proposal
seeking the closure of subsidized coal mines in the 27-nation
bloc by 2014. Germany's new bill establishes a clear commitment
to end coal subsidies, Bruederle said.
Merkel's coalition of Christian Democrats and the FDP is
pushing an extension of nuclear power through parliament that
may avert greater dependency on coal for power beyond 2020. The
SPD, architects of the nuclear phase-out, weighed expanding coal
imports and mining to close a possible power gap as atomic
plants shut and renewable energy grows slowly.
Hard coal, including imports, accounted for 20 percent of
Germany's power generation in 2009, Bruederle's ministry says.
Nuclear plants generated 22 percent of Germany's power last
year, renewable about 16 percent and lignite 23 percent. the
remaining mix of energy sources includes natural gas.
German miner RAG Deutsche Steinkohle AG is the second-
biggest hard-coal producer in the EU after Poland, according to
data from industry group Euracoal. RAG, which operates six mines
and a coking plant in North Rhine-Westphalia and Saarland
states, says the industry supports 27,000 jobs.

For Related News and Information:
Top Commodities: CTOP <GO>
Coal Markets: COAL <GO>
Top Power: PTOP <GO>

--Editors: Jennifer Freedman, Leon Mangasarian

To contact the reporter on this story:
Brian Parkin in Berlin at +49-30-70010-6229 or

To contact the editor responsible for this story:
James Hertling at +33-1-5365-5075 or jhertling@bloomberg.net