It is not without irony that during the UN climate conference in the Polish mining city of Katowice, the country’s President Andrzej Duda declared he would protect the mining industry. Coal is a topic high on the COP24 agenda.
Duda and other coal supporters argue that coal, as well as the traditional forms of energy, can offer energy security. But this is not the general assumption in other parts of Europe. It is widely considered that coal has become a mostly uncompetitive form of electricity production and that renewables have more to offer.
On the side lines of COP24, European Interest interviewed Kathrin Gutmann, an expert in climate and energy policy as well as advocacy. In her role as coordinator of NGO efforts to phase out coal with the Climate Action Network (CAN) Europe, Gutmann is leading the development of the Europe Beyond Coal Campaign.
She said that under the CAN Europe, limiting global warming to 1.5 degrees Celsius the EU would need to be carbon neutral by 2040 – much earlier than what the Commission has proposed. The important thing now for the EU is to substantially increase its climate ambition for 2030 and for the EU countries to put measures in place to reach it.
Gutmann is clear: the coal industry is dying while renewables offer more now in costs, efficiency and employment.
“It is not a matter whether or not the EU will become coal free, it will – it is a matter of whether this will happen quickly enough,” she explains.
European Interest: As part of its Paris Agreement obligations, the European Commission has presented a carbon-neutral vision for 2050. How optimistic are you about this? How realistic is it, considering there are more new coal plant projects planned than those being retired?
Kathrin Gutmann: It is very welcome and important move by the Commission to have presented such a vision. The Climate Action Network Europe outlines that for limiting global warming to 1.5 degrees Celsius the EU would need to be carbon neutral by 2040, hence earlier than what the Commission proposes. The important thing now for the EU is to substantially increase the EU’s climate ambition for 2030 and for the EU countries to put measures in place to reach it.
Overall, the amount of coal power plant capacity and electricity from coal in the EU is in decline. It is not correct to say that in the EU more coal plants are planned than proposed to be retired. The opposite is true. In addition, 10 countries in Europe have committed to phase out coal, whilst Germany and Spain are discussing coal phase out and discussion on this have begun in Hungary and Slovakia.
For an overview on coal phase out commitments from governments, you can read this briefing from Europe Beyond Coal here.
It is not a matter whether or not the EU will become coal free, it will – it is a matter of whether this will happen quickly enough. Trends are such that more coal plants have to close much earlier for the EU to be on track to be coal power free by 2030 as part of the overall transformation away from all fossil fuels. Germany agreeing a coal exit will be a particularly important decision that is expected to be agreed and implemented in 2019. The EU’s coal power plants are mostly very old and polluting: Based on modelling published by Europe Beyond Coal and partners in the ‘Last Gasp’ report the coal power plants operated by the top ten EU coal companies have caused an estimated €22bn of health costs in 2016. The majority of citizen’s want clean air and climate action and at the same time renewables are now more competitive. This makes reality our ally in being able to speed up the needed transformation.
On the 1st of January 2019, Romania will succeed Austria in taking up the rotating EU Presidency. Although Romania is not among the first EU countries in coal production, it has a considerable coal-fired power sector. What do you expect from the Romanian Presidency in relation to the use of coal in energy?
Both Romania’s National Energy strategy and the draft National Energy and Climate Plan, recently published, show a continued dependence on coal and no plans for phase out. The hope to still have coal in the energy system in 2050 is ridiculous, given the fact that the average age of units in the system today is 41 and most of them are already uneconomical. The Romanian Presidency’s themes do not include energy, but there are points on sustainable development, innovation or solidarity and cohesion (http://www.romania2019.eu/en/topics-of-interest/). This creates the perfect context to focus on a just transition for mining regions, especially considering that the topic is high on international agenda – the ongoing COP in Katowice is a clear example in this sense. But Romania’s approach of the topic at the national level – only trying to tick some boxes in order to increase EU fund absorption rates – does not make us hopeful to have any ambition in this sense.
The EU has set itself an overall target of 20% green energy by 2020. But Germany, instead of leading the ‘green energy revolution’, remains dependent on coal. In addition, Poland has announced that will start investing in a new coal mine next year in the south of the country that is the most polluted. Taking all this into consideration, how much power do you think the EU has to impose its rules on energy on national governments?
The EU can have a significant impact on national level policy making through many different EU level policies, incentives and regulations. Coal has become a mostly uncompetitive form of electricity production, outperformed and outsmarted by renewables, with more and more coal power plants not wielding a profit anymore. Companies and governments are increasingly seeking subsidies to prop up their plants or finance upgrades. This means that EU regulations that take into account climate and health as well as economic objectives around state aid or in what cases capacity payments to keep coal plants available can or cannot be given, can have a significant impact. New EU regulations on capacity payments currently being negotiated can have a significant impact on Poland. If the EU agrees to a forward-looking energy market design regulation that is aligned with the EU’s goals on climate and energy and a functioning EU wide energy market, it will mean that a regulation will be put in place applying the so-called ‘550 gCO2/KWh’ rule, where coal power plants cannot receive capacity payments as they emit too much CO2. Such an outcome would mean that Poland has to adjust its own capacity market scheme, which is currently geared to financing its coal industry (this became apparent with the first auction as outlined by the Climate Action Network, which can be read here).
Similarly, because the EU’s coal fleet is old and pollution, tighter air pollution standards set under the so-called BREFs for Large Combustion Plants in 2017 will impact a significant amount of coal power plants, including in Poland and Germany, where utilities and governments are now facing a decision to either invest and upgrade or schedule the plant to close down.
The governments of the countries opposing renewables argue that without coal, gas and oil, there is no energy security for their countries. For this reason, the EU pays billions in subsidies to the related sectors. Is this true? Or do you think that renewables can represent a viable alternative to coal and other less green forms of energy?
We have already member states in the EU that have very high shares of renewables in their current electricity mix – look at the Scandinavian countries, at Austria – and others that have already considerable periods of very high or 100% renewables shares in electricity such as the UK, Germany or Portugal. These countries show that it is very possible to build a renewables-based electricity system. Here being part of Europe is important, as opposed to each country pursuing its own independent concept, in order to take advantage of interconnectors and build a more flexible system spanning the continent. Europe is highly dependent on imports for coal, gas and oil, which is problematic for energy security. Even Poland is a net-importer of coal, importing hard coal from Russia.
The last week of November was marked by miners striking in Bulgaria, a country that produces coal. Their demand was the protection of the coal production industry. Since the coal sector employs hundreds of thousands of workers in EU member states, and the advance of renewable energy threatens their jobs, is there any specific proposal on who will be faced a mass unemployment in the sector?
The coal industry in Europe is dying and under enormous economic pressure as it is increasingly uncompetitive. In fact, the number of jobs in the coal industry have compared to the last decades declined dramatically everywhere in Europe. This is happening due to a number of reasons – not only because, as the question suggests, due to the competition of renewables that are preferable economically and environmentally. Rationalization (less workers needed for mining) has played a factor, but also because mining in Europe has become uneconomic, with companies preferring to import coal from Russia, the US, Colombia etc. The number of jobs in the Polish coal sector have dropped to 80,000 in 2017 from nearly 400,000 in 1990. In the meantime, the number of jobs in the renewables sector have grown considerably, having fully overtaken the coal sector. To give an example for Germany: less than 20,000 people work in the coal mining sector, compared to around 339,000 in the renewables sector.
Rather than investing millions to prop up an industry to last a while longer, money should be invested into region transformation of the affected regions starting now with the specific goal to support them to move beyond coal. Countries such as Bulgaria and Romania should be receiving EU financial support for undertaking such a transformation. Coal phase out in the case of mining is a long process that lasts for decades even after the mines close and should be started as early as possible, to avoid a crash-and-burn scenario, when the subsidies have become too large to keep up or the industries go bankrupt which any level of subsidy at some point will not be able to avoid. A crash-and-burn scenario only leaves the communities and public purse having to pay for the significant post-mining clean up, without having built up alternatives. A managed and planned coal phase out though is not just a matter of funding, it needs to be given significant political attention and support and closely involve affected communities, local stakeholders and also the non-mining economic players in order to map out alternative economic concepts and options.
Far-right populists are against renewables. Germany’s AfD, for instance, wants the country to withdraw from the Paris Agreement. Why do you think the question of renewables has become an issue for this specific political movement?
The far-right populists have gathered people that thrive on conspiracy theories, including those that believe climate change is not real and not human-induced, despite the >98% of climate scientists saying the opposite. Those populists define themselves as anti-government as it exists in many democracies. Given that the need to prevent run-away climate change and to grow renewables has become a now widely accepted priority in most countries, it fits into their anti-government stance to also be climate sceptic and oppose solutions to tackle the climate crisis like renewables.
When implementing climate policies and building renewables it is very important to ensure local and public participation, that benefits from the renewables economy reach the local and regional level and to conceive from the start of social policies that mitigate any impacts of the speedy transformation to a carbon free society. Doing this will also give fewer entry points to far-right populists.