German Wind, Solar Power Beat Coal Generation for First Time

(Bloomberg) -- Germany’s wind and solar farms surpassed lignite and hard coal as sources of electricity for the first time during the six months to June, a sign the market is starting to squeeze out the dirtiest fossil fuels.

The power mix in Europe’s biggest economy hit a turning point when clean generation surged 10 percent to 118 billion kilowatt-hours through June, the BDEW utilities federation said Tuesday. Coal’s share of the market dropped 10 percent from 2017 to 114 billion kilowatt-hours.

“A market-driven, step-by-step exit from coal power is already in full gear,” said the Berlin-based federation, which represents utilities including RWE AG and EON SE. “Renewables are on the march but what we need more urgently than ever is to accelerate expansion of the grid.”

The priority given to clean power on Germany’s grid, along with the rising cost of carbon permits has helped to dislodge coal from the energy mix. The development may be fortuitous for Chancellor Angela Merkel as her administration struggles to make good on a pledge to phase out coal power.

Merkel has set up a commission of 28 experts, which includes environmentalists, who are mapping out a final exit from coal power. The group is due to present its findings in December and will probably recommend a staggered, target-based retirement of coal plants that could mix market incentives and compensation to encourage closures, officials have said.

About 50 percent of current coal-power capacity must be withdrawn from the grid by 2030 to meet the energy sector’s carbon pollution reduction target, the Economy and Energy Ministry said.

Germany must guard against blackouts as coal power declines and the last nuclear reactors are shuttered in 2022, the BDEW said Tuesday. The nation’s seven atomic reactors boosted output in the first half make up 11.3 percent of total supply, up from 10.2 percent a year ago.

To contact the reporter on this story: Brian Parkin in Berlin at bparkin@bloomberg.net

To contact the editors responsible for this story: Reed Landberg at landberg@bloomberg.net, Jonathan Tirone, Helen Robertson

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