Reiche wants to temporarily bring back reserve coal-fired power plants

Due to the escalation in the Middle East, Economics Minister Katherina Reiche is planning to temporarily bring coal and oil-fired power plants back into the electricity market from reserves in order to save natural gas. This emerges from a draft bill from your ministry (BMWE) dated October 16th, which “Politico” was able to see.

The measure is justified in the draft by the tense supply situation. According to the draft, blocked transport routes and destroyed production and export facilities in the Middle East limit the availability of fossil fuels. For Germany, there is therefore “an increased risk of supply bottlenecks, especially for natural gas,” the ministry argues in the draft.

According to it, “additional generation capacity for generating electricity should be made available to the electricity market for a limited period in the event of a gas shortage,” it says. Power plants that serve as network reserves and use coal or mineral oil should be used for this purpose.

So far, these reserve power plants can only be used when there is a shortage of electricity. The bill is intended to enable a return to the electricity market by the end of March 2028. This will “help reduce natural gas consumption and reduce the dependence of Germany’s electricity supply on geopolitical tensions in the Middle East,” it says. Both oil and coal are available at short notice and their procurement does not directly depend on the crisis regions affected.

However, before a reserve power plant can participate in the electricity market, according to the draft, the federal government must first declare the alarm or emergency level of the gas emergency plan. Then the return should be permitted via a BMWE regulation. Participation should be voluntary for operators.

Regardless of this, however, they should be obliged to keep their systems “continuously operational and to maintain appropriate fuel stocks” as soon as the law comes into force and as long as at least the early warning level in the gas emergency plan applies. The costs should be reimbursed and passed on to electricity customers via the network fees, even if the power plants are never used on the market. The ministry does not quantify how high they will be in its draft.

The ministry, however, refuses to reactivate coal-fired power plants that have already been shut down. This would take an average of 12 to 24 months, meaning the systems could hardly contribute to gas savings within the period of validity of the law.

The draft for the changes to the energy industry law has apparently not yet been finally clarified: some passages are still in square brackets.

At the beginning of October, the BMWE informed “Politico” that the ministry was still examining the possible use of reserve power plants to stabilize electricity costs.

There were also doubts within the company as to the extent to which the reactivation of the coal-fired power plants would have price effects, as “Politico” reported. However, the Union and the SPD had already agreed on this project in the coalition agreement.