PRESS RELEASE: Too much money for the German coal phase-out? Commission launches in-depth investigation

PRESS RELEASE, 2nd of March 2021 – Brussels

Too much money for the German coal phase-out? Commission launches in-depth investigation

The European Commission has just announced that it is launching an in-depth investigation into the planned compensation for lignite operators under the German Coal Phase-out Act. This means that the “Agreement on the Reduction and Termination of Lignite-Based Power Generation in Germany” is entering the next phase of the competition law investigation. The in-depth investigation by the European Commission is expected to take one year. Until it is completed, no compensation may be paid. The Commission justifies its decision by stating that, on the basis of the information available, it cannot conclusively assess whether the permitted level for compensation payments has been complied with.
The German government had agreed to compensations of €4.35 billion with lignite operators. Although the European Commission’s review under competition law had not yet been completed, the German Bundestag also gave its approval to the agreement on January 13 at the request of the Federal Ministry for Economic Affairs and Energy.
Green MEP Jutta Paulus, member of the Environment Committee and substitute member of the Industry, Research and Energy Committee, comments:
“I welcome today’s decision by the European Commission to launch an in-depth investigation into the compensation payments to lignite operators contractually promised by the German government. Contrary to all economic forecasts and without taking into account the expected high prices for CO2 certificates, Mr. Altmaier’s ministry calculated fabulous sums for alleged lost profits and set them as minimum compensation. In this way, the German government wants to give the ailing coal companies a veritable windfall from tax revenues.
The exorbitantly high financial commitments raise serious doubts about their compatibility with EU competition law. According to a study by the Ökoinstitut, they are overdrawn by 2 billion euros. In addition, taxpayers’ money is to flow into the renaturation of the destroyed landscape, although the companies are legally obligated to pay for the damage they have caused. This turns the polluter pays principle on its head!”