Wintershall Demands Brown Coal Closures

Wintershall, the upstream arm of German chemical giant BASF, has made probably its most direct call yet for the closure within five years of brown coal (lignite) fired power plants in Germany to achieve the country's emission reduction targets. It has thrown its weight behind a report advocating the shutdown of German lignite-fired plants by 2023 and their replacement by gas-fired ones.

"Flexible and highly efficient gas power plants should partner up with the renewables in the electricity market," said Wintershall board member Thilo Wieland, adding that in Germany: "We must return to the original idea of the energy transition: renewables plus natural gas." His call comes less than two weeks before the start of the UN’s 'COP24' climate change conference in Katowice, Poland.

Instead around 40% of electricity in Germany is currently generated from coal and lignite, he added, while gas-fired plants contribute 13%. It was grotesque, as "lignite-fired power plants produce three times as much CO₂ as gas power plants in generating electricity," he told a conference in Berlin. 

A study for German gas lobby Zukunft Erdgas by independent consultancy Aurora Energy had looked at the impact of a partial phase-out of lignite (brown coal) as a means of generating power within the next five years. Wieland said the study’s conclusion was optimistic: the original climate target of a 40% reduction in German CO₂ emissions over 1990 can no longer be achieved by 2020, but probably can by 2023.

But the vital prerequisite would be to shut down lignite-fired power plants that together have a capacity of 9 gigawatts. Second, there has to be an uncompromising switch to gas power plants, whose capacity is usually not fully used at present.  

Wieland's appeal comes as a government commission, known generally as the 'Kohlekommission' hears evidence and plans to draw up a report advising the German government on how to tackle emissions. The coalition government that took office in March 2018 had two months earlier junked a commitment to reduce German CO2 emissions by 40% between 1990 and 2020. RWE's plan to extend strip-mining of lignite which would have required the felling of ancient woodland was put on hold by a court last month.

Independent data from Germany's AGEB two weeks ago showed that, whereas Germany's use of coal, oil and gas across the whole economy fell steeply year-on-year in the first nine months of 2018, the decline in lignite consumption was tiny at just 1.9%.

Wieland’s responsibilities include Wintershall’s gas pipeline stakes and Russian upstream interests. Wintershall and DEA plan to merge to become a new merged upstream independent by end-1Q 2019, subject to regulatory approvals. He also said that natural gas is ready for use in transport (cars, trucks and buses) and said that the new German cruise ship AIDAnova will next month start operating powered by LNG.