Four in five EU coal plants losing money

24th October 2019


Web coal istock 483123266

Related Topics

Related tags

  • Fossil fuels ,
  • EU ,
  • Investment

Author

Thomas Tremlett

A whopping 79% of coal power plants in the EU are unprofitable, a new study by Carbon Tracker has uncovered, with the sector facing loses of ‚Ǩ6.6bn (£5.7bn) this year alone.

In a report published today, the think tank urges investors and policymakers to prepare for a “complete phase-out“ of coal by 2030 amid competition from low-cost wind, solar and gas.

It claims that the coal sector cannot survive without heavy subsidies, and that governments face “intractable problems“ if they continue to support the industry in the long term.

By continuing subsidies, leaders will have to choose whether to pass the costs on to utilities and destroy shareholder value, to customers and push bills up, or to fund coal from debt or taxes, according the report.

“EU coal generators are haemorrhaging cash because they cannot compete with cheap renewables and gas, and this will only get worse,“ said report co-author, Matt Gray.

“Policymakers and investors should prepare to phase out coal by 2030 at the latest.“

Carbon Tracker used asset-level financial models to analyse the operating economics of every coal plant in the EU and the losses that they could face in 2019.

Hard coal generation has fallen 39% since 2018, resulting in “eye-wateringly low“ utilisation rates, according to the report, while lignite generation is down 20%.

The researchers found that Germany's lignite and hard coal plants could lose €1.9bn in 2019, yet the country's coal exit commission has only recommended a phase-out by 2038.

Spain and the Czech Republic, which have yet to set phase-out dates, face losses of €992m and €899m respectively, while the UK, which has a 2025 deadline to close its remaining coal plants, is likely to lose €732m.

In total, Carbon Tracker estimates that 76% of hard coal generation, and 84% of lignite generation, is unprofitable, with these facing loses of €3.03bn and €3.54bn respectively.

“Getting off coal is cheap and can be a win-win for consumers and shareholders, providing governments and investors work with local communities, Gray added.

Image credit: ©iStock

Subscribe

Subscribe to IEMA's newsletters to receive timely articles, expert opinions, event announcements, and much more, directly in your inbox.


Transform articles

How much is too much?

While there is no silver bullet for tackling climate change and social injustice, there is one controversial solution: the abolition of the super-rich. Chris Seekings explains more

4th April 2024

Read more

Alex Veitch from the British Chambers of Commerce and IEMA’s Ben Goodwin discuss with Chris Seekings how to unlock the potential of UK businesses

4th April 2024

Read more

Five of the latest books on the environment and sustainability

3rd April 2024

Read more

The UK’s major cities lag well behind their European counterparts in terms of public transport use. Linking development to transport routes might be the answer, argues Huw Morris

3rd April 2024

Read more

Ben Goodwin reflects on policy, practice and advocacy over the past year

2nd April 2024

Read more

A hangover from EU legislation, requirements on the need for consideration of nutrient neutrality for developments on many protected sites in England were nearly removed from the planning system in 2023.

2nd April 2024

Read more

It’s well recognised that the public sector has the opportunity to work towards a national net-zero landscape that goes well beyond improving on its own performance; it can also influence through procurement and can direct through policy.

19th March 2024

Read more

The UK government’s carbon capture, usage and storage (CCUS) strategy is based on optimistic techno-economic assumptions that are now outdated, Carbon Tracker has warned.

13th March 2024

Read more

Media enquires

Looking for an expert to speak at an event or comment on an item in the news?

Find an expert

IEMA Cookie Notice

Clicking the ‘Accept all’ button means you are accepting analytics and third-party cookies. Our website uses necessary cookies which are required in order to make our website work. In addition to these, we use analytics and third-party cookies to optimise site functionality and give you the best possible experience. To control which cookies are set, click ‘Settings’. To learn more about cookies, how we use them on our website and how to change your cookie settings please view our cookie policy.

Manage cookie settings

Our use of cookies

You can learn more detailed information in our cookie policy.

Some cookies are essential, but non-essential cookies help us to improve the experience on our site by providing insights into how the site is being used. To maintain privacy management, this relies on cookie identifiers. Resetting or deleting your browser cookies will reset these preferences.

Essential cookies

These are cookies that are required for the operation of our website. They include, for example, cookies that enable you to log into secure areas of our website.

Analytics cookies

These cookies allow us to recognise and count the number of visitors to our website and to see how visitors move around our website when they are using it. This helps us to improve the way our website works.

Advertising cookies

These cookies allow us to tailor advertising to you based on your interests. If you do not accept these cookies, you will still see adverts, but these will be more generic.

Save and close