Vattenfall AB, a producer and retailer of electricity and heat, has announced that it plans to close the company’s largest German coal-fired power plant. The closure is in response to a plan by Germany to provide coal plant operators with money to offset financial losses, effectively incentivizing the path for more sustainable power sources. The plant only came online in 2015, and opponents questioned the viability of the plant because coal plants, in general, were struggling economically. The operators have now admitted that the plant isn’t profitable and so they have offered the plant up as a potential candidate for the offset funds. If chosen, the Moorburg plant in Hamburg will be closed wholly or partially within months.
The Moorburg plant does provide electricity to local manufacturers, which means that the government may not want the plant to be shut down. Vattenfall has announced that it plans to close all fossil fuel-powered plants by 2030, regardless of the location. In regard to the Moorburg plant, Magnus Hall, CEO, says that “If we get the contract, we would close the corresponding capacities in the middle of next year.” Originally, the Moorburg plant was planned to operate until at least 2038. The plant’s financial viability is challenged by the German government’s system that requires the purchase of carbon dioxide (CO2) emissions credits for facilities that emit the gas. In 2019, the plant emitted 4.7 million tons of CO2.
The cost of the credits along with low electricity prices have made the plant unprofitable for Vattenfall. The company, Solna, Sweden, operates in markets primarily in Sweden, Germany, the Netherlands, Denmark, and the UK with about 20,000 employees. (11/20 pbe)