Germany Studying Three Plans to Cut Emissions From Power Plants

Germany is looking at three proposals to cut emissions from the energy industry, including a “step by step” plan to close coal-fired power stations like those operated by RWE AG and Vattenfall AB.

Besides a plan developed internally, the Economy Ministry is also looking at a proposal from the IG BCE mining union to gradually close lignite plants, and a third option that would add more combined heat and power stations, Economy Minister Sigmar Gabriel said Friday in Berlin.

Gabriel said his ministry’s proposal is the lowest-cost option, though he’s open to ideas that require more spending to avoid job losses. Utilities, unions, state governors and some members of Chancellor Angela Merkel’s coalition have lined up against a plan to force the power industry to cut 22 million tons of CO2 by the end of this decade.

“Nothing has been taken off the table,” Gabriel told lawmakers in the lower house of parliament in Berlin. While the 22 million-ton target won’t change, specific details about how to reach it are up for debate.

Behind the squabbling is a dispute over how to usher in renewable energy technologies while protecting traditional energy producers that provide thousands of jobs.

The union’s plan includes boosting output of combined heat and power plants, establishing a electricity capacity reserve, and introducing a “scrapping bonus” to replace old oil-based heating systems in homes with more efficient ones that use natural gas. After four years in the reserve, coal plants would be closed for good, according to the plan.

The ministry’s plan involves introducing a so-called climate fee to utilities as an incentive to eliminate coal plants. The industry has said that would require them cut jobs.

The third plan focuses on adding more heat-and-power plants.

Lawmakers from the Greens and Linke opposition parties said Gabriel is bowing to pressure from the industry by watering down his ministry’s proposal, which has already been rejected by RWE.