Merkel’s Green Energy Policy Has Fueled Demand for Coal

By 2030, the eastern German town of Poedelwitz will likely be razed to get at the rich veins of coal beneath its half-timbered houses. The reason: Chancellor Angela Merkel’s effort to steer Germany toward greener energy, which has unexpectedly meant booming demand for dirty coal.

While Merkel aims to wean the country from nuclear power and boost renewable energy, the shift has been slow—Germany’s 140-plus coal-fired plants last year supplied 40% of the country’s electricity—and Poedelwitz is flanked by open-pit lignite mines that feed a 2-gigawatt power plant a few miles away, Bloomberg reported.

Fine-tuning the shift toward cleaner energy will be near the top of Merkel’s to-do list if she wins a fourth term as chancellor in the Sept. 24 elections. Germany began subsidizing wind and solar in 2000, but the pace picked up after 2011, when Merkel initiated her “Energy Shift” in reaction to the meltdown at Japan’s Fukushima plant.

Merkel aims to cut carbon dioxide emissions by 40% by 2020 from the 1990 levels and Germany has spent some €650 billion ($780 billion) on subsidies for green power in recent decades. But the country will at best get to 30% by 2020, according to Berlin climate researcher Agora Energiewende. Emission reductions “won’t be a near miss but a booming failure”, Agora researchers write.

That is not to say Merkel’s policy has been a failure. Wind power alone has spawned 143,000 jobs, according to the BWE wind industry lobby, versus 135,000 who work in the traditional power sector and coal mining.

More than a third of Germany’s electricity now comes from wind, solar and biomass, up from a quarter four years ago. And Germany is ahead of the European average, with emissions down 27% from 1990 levels, versus 22% for the 28 members of the European Union.

Merkel’s government says clean power investments will make Germany a global leader in the technologies, giving its manufacturers an edge for decades to come.

“For all the challenges of the Energy Shift, we’re on track to be at the forefront of a radical switch from a carbon-powered economy,” her chief of staff, Peter Altmaier, said.