Home » Archive News In Brief » News in Brief 2021 » News in Brief 05_2021 » Reduced fleet of coal power stations secures supply during harsher winter of 20/21 – high demand until well into the second quarter of 2021

Reduced fleet of coal power stations secures supply during harsher winter of 20/21 – high demand until well into the second quarter of 2021

The first half of 2021 demonstrated that despite the agreed phase-out of coal, the fuel continues to make an important and reliable contribution to electricity generation. The amount of electricity generated in coal power stations increased by more than a third (35.6 %) to almost 25 TWh during a period of low temperatures and significantly less wind power compared to the previous year. Through this growth, coal made a significant contribution to security of supply, underlining its important role in ensuring that the energy transition is a success. According to Germany’s Coal Importers Association (VDKi) in Berlin, coal will continue to be needed in this role in the future, particularly since the German government has increased its forecast for energy consumption in 2030 to between 645 and 665 TWh/a.

The Coal Phase-out Act came into force on 8th August 2020. The first three invitations to tender saw 25 successful bids with a bid volume of 8,435 MW. This included a number of young, modern coal power stations. The mechanism of the law has therefore not resulted in primarily older power stations with higher specific CO2 emissions being taken off the grid.

Coal power stations in southern Germany are at a big disadvantage at the auctions for capacity to be decommissioned. They were excluded from the first tender process altogether, and a network factor is being taken into account in subsequent tenders, which is very likely to prevent bids from being successful. As a result, employees at south German coal power stations are at a significant disadvantage when it comes to any socially responsible reduction in the workforce.

There is also an urgent need for action with regard to district heating supply. In many German towns and cities, district heating is supplied by highly efficient coal-fired cogeneration plants. The VDKi member companies affected have highlighted difficulties with potential plans to switch to gas or biomass. There is a lack of funding or simply not enough usable gas grid connections.

Now that the Climate Change Act has been passed, the conditions in the energy economy need to be rapidly adapted.

Global coal production declined by approximately 220 M t to 7.06 Bn t in 2020 due to the pandemic, reaching 2018 levels. Essentially, it is only thanks to China’s (+94 M t) and India’s (+7 M t) increases in production that global coal production did not fall even more drastically. Seaborne trade declined in 2020 by 149 M t or 12.1 % to 1,083 M t. Seaborne coking coal exports declined by 13.2 % to 264 M t and the steam coal market by 11.7 % to 819 M t. Coal also continued to ensure economic growth in Asia and other growth regions, with the share of seaborne trade in Asia now 84 %.

On 31st August this year, VDKi celebrated its 125th anniversary in the knowledge that its members continue to make an important and extremely reliable contribution to the German economy through their coal activities. (VDKi/Si.)