G7 Summit Over, Germany Abandons Planned Coal Tax

Berlin DemosThe German government appears to have abandoned the planned carbon tax on coal power plants. This is the result of a meeting of German Economics Minister Sigmar Gabriel (SPD) with the head of the mining union IG BCE, Michael Vassiliadis, and ministers of those states where lignite is produced. The ministry’s original plan was to avoid emitting additional 22 million tons of CO2 by 2020. This plan was opposed by trade unions and energy companies who saw this as an existential threat to Germany’s entire lignite production. These interest groups seem to have won the battle for now. —Der Spiegel, 7 June 2015

Industrial group Siemens has resigned itself to never selling another gas turbine in its home country following Germany’s switch to renewable energy, its chief executive said. Joe Kaeser is cutting 1,600 jobs at Siemens’ power and gas division, which has been turned upside down by the fallout from Germany’s decision to accelerate its nuclear exit and promote renewable energy following Japan’s 2011 Fukushima disaster. “The way in which Germany’s energy transition is being handled has made it impossible for us to ever sell our fossil fuel-related products and solutions in Germany,” Kaeser said in an interview published in Siemens’ staff magazine on Thursday. Reuters, 28 May 2015

Siemens employees turned out in large numbers in Germany Tuesday to rally against massive job cuts announced earlier by the engineering giant’s executive board. In Berlin alone, an estimated 1,500 workers took to the streets in fear of losing their jobs at one of Siemens’ gas turbine facilities. CEO Joe Kaeser pointed to the ongoing problems in the power generation sector as demand for gas turbines had decreased rapidly due to Germany’s shift to renewables. —Deutsche Welle, 9 June 2015

Whoever applies the axe here must know that with the loss of coal production the vertically integrated value chains of metalworking, electrical engineering and chemical industry will start to falter. Germany’s electricity costs for industry are already 26 percent higher than the EU average. Compared to the U.S., the difference is 150 percent now. The creeping process of de-industrialization has already begun. The winners of our job losses will be the USA and the Far East. –Fritz Vahrenholt, Manager Magazin, 5 June 2015

ConocoPhillips, the U.S. energy company, said on Friday it has stopped its shale gas exploration in Poland due to unsatisfactory results, leaving the rest of the field to Polish state-run firms. Earlier this year another U.S. energy major Chevron Corp gave up looking for shale gas in Poland, following the withdrawal of Exxon Mobil, Total and Marathon Oil over the past three years. While exploratory drilling has been done, Poland has not delivered a single commercial well. The only companies that declare further drilling are the state-run gas distributor PGNiG and the refiner PKN Orlen. —Reuters, 5 June 2015

Global growth in coal-fired generation since 2010 has been greater than that of all non-fossil-fuel sources combined. The share of fossil fuels in the total primary energy mix will only slowly decrease from 82 per cent in 2012 to 60-80 per cent by 2040. The proved global coal reserves in 2013 are sufficient to meet 113 years of global production. Global coal consumption is expected to grow by another 15 per cent through 2040. A world without coal is unrealistic even beyond 2040, and new production and transformation technologies – e.g. liquefaction and and gasification – are expected and already underway. — Frank Umbach, European Centre for Energy and Resource Security (EUCERS), King’s College London

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