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The world in an energy crisis

The crises in Ukraine and the Middle East have caused considerable uncertainty on the global energy market, especially in Germany and Europe. The tensions and armed conflicts are having a significant impact on the price structure of the energy markets. Added to this is the great vulnerability of Germany’s energy supply, particularly due to LNG. Replacing Russian gas with gas from the Middle East is not a safe alternative.

“Against this backdrop, it would be grossly negligent not to rely on hard coal as the guardian angel of the energy supply in the upcoming winters,” says Alexander Bethe, Chairman of the Association of Coal Importers (VDKi), Berlin/Germany. German coal-fired power plants are well equipped for the coming winter, especially in view of the shutdown of the last nuclear power plants. A major advantage of hard coal-fired power plants in market operation is their flexibility. They only produce when they are needed. In the winter of 2022/23, they contributed to security of supply and a reduction in gas consumption. In the summer of 2023, when more renewable energies were available, they hardly ran at all.

Bethe: “Hard coal is a substantial component of a secure energy supply. Another major advantage of hard coal is that the raw material comes from different countries and the supply routes are much more resilient than with gas. Last year, e. g., we completely replaced the import of more than 50 % Russian coal for the German market in just a few months. Even the blocking of individual shipping routes can be circumvented relatively easily.”

What is more, LNG is not climate-friendly, and in some cases is even much more harmful to the climate than coal due to the escape of methane. In addition, the market for LNG is scarce, LNG is expensive and the price of LNG is much more volatile than that of hard coal. “There is no prospect of replacing around 18 GW of power generation capacity from hard coal-fired power plants with LNG-fuelled gas-fired power plants,” says Bethe. “This is why hard coal-fired power plants will still be needed for electricity generation in the long term.” For the VDKi, one thing is clear: Back-up from hard coal-fired power plants is essential for Germany’s energy security. “Without hard coal-fired power plants,” says Bethe, “there is no security of supply.”

Power plants that are returned to the market require a maintenance plan in order to be available. Skilled personnel and specialised parts are in short supply. The power plant teams need planning security. In addition, logistics capacities for coal transport must be secured in the medium term. Before last winter, it was a huge feat for the entire industry to organise the necessary logistics (trains, barges) for transporting coal from the seaports to the power plants. This risk should not be taken again. “A lack of planning security ultimately leads to a lack of supply security,” says Bethe. “That is why the Substitute Power Plant Standby Act (EKBG) must be extended.” (VDKi/Si.)