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40 billion euros, the bill to eliminate coal in Germany by 2038

The German government has adopted plans to provide 40 billion euros of financial support to federal states undergoing the structural changes necessary for Germany to achieve its planned coal phase-out by 2038.


According to the German government’s plans, detailed in a document, the government aims to develop existing mining areas in East Germany, as well as the Rhine region, “in the energy regions of the future,” according to the Chinese agency Xinhua.

Support will be provided to the “particularly affected sites” of hard coal power plants, as well as the former Helmstedt lignite mining area in Lower Saxony, according to the German government.

“We keep our promise. The exit of coal must become an opportunity for the affected regions,” said the German Minister of Economy and Energy, Peter Altmaier, who presented the cornerstones.

Angela Merkel’s cabinet “is ensuring clarity in the affected regions and creating long-term prospects with sustainable jobs for the local population,” Altmaier said.

“We are setting the course for districts to become modern energy and economic regions. Now it is a matter of filling this concept with life together with federal states, municipalities and the local population,” emphasized the German economy minister.

The prime ministers of the German federal states concerned welcomed the document adopted by the German cabinet in a joint declaration.

“The federal government acknowledges its responsibility for the future prospects of those regions that will make important contributions to the achievement of national climate objectives and progress towards the transformation of the energy system,” the German federal ministers said.

A “central prerequisite” had been established which would allow regions affected by coal withdrawal to “develop sustainable prospects for growth and employment”, according to the declaration of the German federal prime ministers.

A positive assessment also came from the Economic Research Institute (Ifo).

Most infrastructure projects were sensible, as was the establishment of research facilities in lignite regions “because this contributes to the success of structural change,” said Ifo researcher Joachim Ragnitz.

However, “it would be desirable to concentrate the measures even more on the areas of lignite in the narrower sense than in much of the selected regions, there will be no negative effect at all of the phasing out of coal,” Ragnitz added.

According to the German government’s key issues paper, an “investment law for coal regions” was being planned that would provide 14 billion euros to the affected federal states.

With another 26 billion euros, the German government proposed to implement its own projects, for example, in research and transport.

In order for rapid structural change to begin, an “immediate programme” was planned that would be supported by the German government through funding of up to 240 million euros.

Merkel’s executive will present a bill that will implement the energy policy recommendations of the coal commission in the second half of 2019.

An “adjustment allowance for older workers” in Germany’s lignite industry would also be proposed, according to the document.

About one-third of Germany’s electricity is still generated from coal-fired power plants and, at the end of January, a government commission agreed that Germany should eliminate coal by 2038 at the latest.

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