Merkel’s Green Push Sinks German Coal Profits: Energy
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German Chancellor Angela Merkel’s campaign to limit climate change with an energy system based on renewable sources is cutting into profits of companies that still provide 57 percent of the power that keeps Europe’s biggest economy humming.
The continent’s fivefold increase in solar and wind power in the past decade flooded electricity grids, displacing fossil fuels so fast that coal- and gas-dependent utility RWE AG lost money in 2013 for the first time since 1949. Earnings at European coal-fired plants fell 23 percent last year, the biggest drop since 2010. Margins may vanish in the next two years, according to Kepler Cheuvreux SA, a Paris-based broker.