Germany pushes 17-billion-euro gas power plan despite election uncertainty

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By Markus Wacket and Riham Alkousaa

BERLIN (Reuters) – Germany’s economy minister pushed ahead on Friday with legislation to provide billions of euros to build gas power plants, according to government sources, but the chances of the plan receiving parliamentary approval were slim.

Robert Habeck’s position as head of the economy and energy ministry has become a caretaker role ahead of snap elections in February following the collapse of the governing coalition.

On Friday, he passed the legislation on to government departments for consultation, with the goal of swiftly getting it through parliament before the elections, sources said.

However, that timeline is ambitious, considering his government no longer commands a parliamentary majority.

Andreas Jung, spokesperson for climate and energy policy of the opposition CDU, criticized the government for not providing a formal draft of the Power Plant Safety Act, despite its importance. 

He said only a draft bill for internal review has been submitted, which has raised concerns among energy experts and operators. 

“Since there is still no draft from the government, there is still no basis for parliamentary consultation,” Jung told Reuters.

The plan is to unlock 17 billion euros ($17.70 billion) in subsidies up to 2042 to stabilise the grid with electricity produced from gas when unsteady renewable-energy supplies fall short.

It includes tenders for building new hydrogen-ready gas power plants, retrofitting old gas power plants for the use of hydrogen and tenders for fully-hydrogen-powered plants, the economy ministry added.

Germany is betting on green hydrogen, produced through electrolysis driven by wind and solar power, as an alternative to fossil fuels.

Habeck has been under pressure from energy companies, who complain that his plan was already behind schedule. The first plants are needed by 2030 to ensure a secure supply and enable the minister’s Greens Party to stick to its goal of ending coal-fired power generation by 2030.

Kerstin Andreae, the head of German utilities association BDEW, said achieving the 2030 coal phase-out was contingent on construction of sufficient gas-fired power plants within that time frame, but looked to the successor government for action. 

“The new election must not lead to any further delay, which is why this project must be on the new federal government’s 100-day agenda at least,” Andreae told Reuters.

($1 = 0.9607 euros)