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Setting the scene: A European perspective The current challenge in - - PowerPoint PPT Presentation

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Setting the scene: A European perspective The current challenge in Germany European Environment and Sustainable Development Advisory Council (EEAC) Working Group on Energy and Climate Change; SRU, Berlin 10.10.2018 Dr. Pao-Yu Oei Technische

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Setting the scene: A European perspective The current challenge in Germany

European Environment and Sustainable Development Advisory Council (EEAC) Working Group on Energy and Climate Change; SRU, Berlin 10.10.2018

  • Dr. Pao-Yu Oei

Technische Universität Berlin, Research group CoalExit German Institute for Economic Research (DIW Berlin)

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Agenda

1. Motivation 2. Status Quo of Coal in Europe 3. Looking at Coal Phase-out Experiences in Germany 4. Enabling a “just transition“

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Coal is currently an important factor for global economies but also the single biggest contributor to climate change.

Sources: Le Quéré et al. (2015), WorldCoal (2017), Carbon Brief (2017).

How can a reduction in coal consumption in line with the 2°C target be achieved in the EU? Coal used to generate

41 % of global electricity.

Coal was used in

70 % of global steel production.

Coal was responsible for

39 % of total EU ETS emissions.

Coal (& steel) historically played a crucial part for the EU in terms of its creation, employment, its economy, etc. Paris Agreement entered into force in November 2016

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Agenda

1. Motivation 2. Status Quo of Coal in Europe 3. Looking at Coal Phase-out Experiences in Germany 4. Enabling a “just transition“

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Coal capacities and demand in Europe is shrinking. Countries without coal in Europe: BE, CY, EE, LT, LU, LV, MT

Source: CAN database / Sandbag (2016); Europe beyond Coal (2018)

2030 2025 2025 2030 2029 2035 ? 2016 2025 2029 2021 2022 2025

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Coal power plants & emissions of CO2, PM, Nox, SO2 in Europe

Source: EC-JRC (2018).

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Projections for coal power plants in Europe 2016-2030

Source: EC-JRC (2018).

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Necessity to phase-out coal vs. current status quo.

Germany Poland United Kingdom

  • Installed coal capacity:

15 GW.

  • Import dependence coal:

88%.

  • First country to mainly

use fossil fuels (steam engine 18th century).

  • Coal consumption fell

from 39% (2012) to 2% (2017).

  • Coal phase-out: by 2025.

Sources: See references pictures and relevant references at the end of presentation.

  • Installed coal capacity:

49 GW.

  • Import dependence coal:

45%.

  • Biggest lignite producer

globally, biggest hard coal importer EU.

  • Commission on coal

phase-out plans and transition started its work in June 2018.

  • Installed coal capacity:

27 GW.

  • Import dependence coal:
  • 8%.
  • EU’s 1st hard coal & 2nd

largest lignite producer.

  • Bad mining conditions,

domestic coal more expensive that imports.

  • Expansion plans for coal

mines and power plants.

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Main results for each case study country

UK: The Carbon Price Floor and Emission Performance Standards were

successful tools to drive coal out of the market. Cautionary tale: mere switch to natural gas needs to be prevented in other countries.

GER: The overall increase of renewable energies is not enough to drive coal out of

the market, due to successful lobbying of major electricity corporations and unions against e.g. the climate levy and for continued (financial) support for coal.

POL: Uneconomic coal is not enough to end its production due to strong relations

between the state and corporations and powerful unions. Dwindling resources and rising resistance against air pollution might accelerate coal’s decline.

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Effect of a coal phase-out on employment in Europe

Source: EC-JRC (2018).

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Renewable Energy potential in coal mining regions

Source: EC-JRC (2018).

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Agenda

1. Motivation 2. Status Quo of Coal in Europe 3. Looking at Coal Phase-out Experiences in Germany 4. Enabling a “just transition“

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Long history starting with the European Coal and Steel Community in 1951 and coming to an end in 2018

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Hard coal phase-out was economically driven and replaced by cheaper imported hard coal

  • Domestic hard-coal was up to

four times more expansive compared to imported coal

  • Substitutional processes in

households and industry

  • Production and employment in

Germany peaked in 1957

  • Germany spent at least €330

billion on direct and indirect hard coal subsidies

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Development of coal and RES employment and electricity share in Germany from 1980 to 2017

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Agenda

1. Motivation 2. Status Quo of Coal in Europe 3. Looking at Coal Phase-out Experiences in Germany 4. Enabling a “just transition“

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Reduction of German coal power plants in line with 2° target

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

The carbon lock-in of coal regions and actors originates from various sources

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Lessons learnt – enabling a ‘just transition’

Fossil fuel- based economy Decen- tralized renewable energy system Energy system Finance Workers & Citizens Economy & Industry Education & Research facilities Infrastructure Soft location factors National or supranational (structural) policy level Regional (structural) policy level Social security and pension system Multi-level, polycentric governance and planning Participation & consensus of relevant stakeholders

Theory

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E.g. in Germany

So who is in charge of managing a coal phase-out

Putting it into practice; e.g. in Germany

Federal Ministry for Economic Affairs and Energy Federal Ministry for the Environment, Nature Conservation and Nuclear Safety Federal Ministry of Labour and Social Affairs Federal Ministry of the Interior, Building and Community

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Recent events: #Hambibleibt

  • In September 2018, RWE and up to 4,000 police men and women started with the eviction of

around 90 tree houses and 200 activists from the Hambach Forest.

  • The Hambach Forest in North Rhine-Westphalia has existed for 12,000 years and meets all

technical criteria of the European Union’s Habitats Directive.

  • RWE’s actions transformed the Hambach Forest into the symbol for Germany´s coal phase-
  • ut movement – comparable to Wackersdorf or Gorleben of the anti-nuclear movement.
  • The growing support during these weeks gained momentum leading to protests of up to

50,000 people as well as civil disobedience actions spread across the country.

  • In October, a court decision forced RWE to halt the clearing of the forest at least for another

year due to a pending verdict on a lawsuit brought by an environmental NGO.

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Setting the scene: A European perspective & The current challenge in Germany

European Environment and Sustainable Development Advisory Council (EEAC) Working Group on Energy and Climate Change; SRU, Berlin 10.10.2018

  • Dr. Pao-Yu Oei (pyo@wip.tu-berlin.de)

Technische Universität Berlin, Research group CoalExit German Institute for Economic Research (DIW Berlin)

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Pao-Yu Oei CoalExit Group; DIW Berlin and TU Berlin

Selected References

Brauers, H. et al. Coal transition in Germany - Learning from past transitions to build phase-out

  • pathways. (IDDRI and Climate Strategies, 2018).

https://www.iddri.org/sites/default/files/PDF/Publications/Catalogue%20Iddri/Rapport/20180 609_ReportCOAL_Germany.pdf Herpich, P., Brauers, H. & Oei, P.-Y. An historical case study on previous coal transitions in

  • Germany. (IDDRI and Climate Strategies, 2018).

https://coaltransitions.files.wordpress.com/2018/07/2018-historical-coal-transitions-in- germany-report1.pdf

  • SRU. Start coal phaseout now. (2017).

https://www.umweltrat.de/SharedDocs/Downloads/EN/04_Statements/2016_2020/2017_10_s tatement_coal_phaseout.pdf?__blob=publicationFile&v=4 European Commission, Joint Research Council (2018) EU coal regions: opportunities and challenges ahead. https://ec.europa.eu/jrc/en/publication/eur-scientific-and-technical- research-reports/eu-coal-regions-opportunities-and-challenges-ahead Göke, L., Kittel, M., Kemfert, C., Oei, P.-Y. & von Hirschhausen, C. Scenarios for the Coal Phase-out in Germany – A Model-Based Analysis and Implications for Supply Security. (DIW Berlin, German Institute for Economic Research, 2018). DIW Berlin, Wuppertal Institut & Ecologic Institut. Die Beendigung der energetischen Nutzung von Kohle in Deutschland: Ein Überblick über Zusammenhänge, Herausforderungen und Lösungsoptionen. (2018).