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Berlin Takes on Brussels: Merkel's Ongoing Fight to Extend Coal Subsidies - SPIEGEL ONLINE - News - International

The European Commission has decided to end coal subsidies by 2014, a decision which does not sit well with Chancellor Angela Merkel. She wants Europe to revisit the decision, but support is lacking. Even her own economics minister is standing in the way. By SPIEGEL Staff

When Chancellor Angela Merkel sees Economics Minister Rainer Brüderle at her weekly cabinet meetings on Wednesdays, it quickly becomes clear that the relationship between the two politicians is marked by distrust. Some time ago Brüderle, a member of the pro-business Free Democratic Party (FDP), ignored an important call from the chancellor on his mobile phone, a move which didn't exactly improve an already frosty relationship.

The relationship is likely to sink to a new low in the coming weeks. Once again, there are disagreements over energy policy. In the wake of the debate over the future of nuclear power, the government must now address what is to become of Germany's coal industry. There are no indications that the wrangling will produce an outcome that the government will be able to portray as a victory.

Merkel is fighting to keep German coal mines alive, with government subsidies, until 2018, and she is doing so against the wishes of the European Union. In mid-July, the European Commission decided that coal subsidies were to be phased out by 2014. Günther Oettinger, the former governor of the southern German state of Baden-Württemberg, who Merkel had installed as energy commissioner in Brussels, had unfortunately skipped an important meeting in the negotiations.

by Nomad on Wed Oct 13th, 2010 at 03:48:58 PM EST
[ Parent ]
What strikes me is how this discussions appears to be treated as unrelated to the recent flap on nuclear plants and renewables, or to other discussions on the "cost" of renewable energy support mechanisms. Renewable energy appears costlier, and in need of subsidies, precisely because basic power generation is subsidized through other means, like payments to coal mines.

Wind power
by Jerome a Paris (etg@eurotrib.com) on Thu Oct 14th, 2010 at 03:36:00 AM EST
[ Parent ]
So true, as Germany's energy policies begin to be schizophrenic.

The good news, if i recall correctly, is that germany is now down to 20,000 in the mining industry from a peak of 600,000, and just 4 mines.

the bad news is politicians in both major parties, but particularly the SPD, remain committed to what was once their base (at least in NRW and Saarland.)

for comparison, windpower alone has some 110,000 (est.) working here.

"Life shrinks or expands in proportion to one's courage." - Anaďs Nin

by Crazy Horse on Thu Oct 14th, 2010 at 03:48:17 AM EST
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Of course. And in the same vein, back on this side of the Rhine river: Sakozy's pal Henri Proglio wants to jam yet another electricity rate increase down the French people, all in the name of "subsidizing the renewable energies":

Solar power may cause French electricity price rise | RFI

Renewable energy is a budget burden for France's energy company EDF, and the industry's rapid-fire growth is only adding to the strain.

EDF's mission has long been to support sustainable producers by buying at prices set by the government. But the industry's success has seen costs skyrocket - and the government in turn has cut subsidies.

Les Echos on Tuesday reported that EDF chief Henri Proglio wrote a letter to French Energy Minister Jean-Louis Borloo warning that EDF's 2009 budget gap of 1.6 billion euros stands to increase to 2.6 billion by the end 2010.

He added that this could exceed 15 billion after 2015.

Somebody has to cover the costs of renewable industry development - and the National Assembly's Finance Commission is proposing that private power bills should bear the shortfall.

by Bernard on Thu Oct 14th, 2010 at 11:08:39 AM EST
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