The impact of an accelerated phase-out of coal-fired power generation in the Rhineland region

The impact of an accelerated phase-out of coal-fired power generation in the Rhineland region

In January 2019, the WSB commission for growth, structural change and employment in the Rhineland region published its final report.

The report recommends an accelerated phase-out of coal power generation by 2038 at the latest. The largest German lignite mining area is located in the Rhineland region and sits within the districts of three local chambers of commerce and industry (Aachen, Cologne and Mittlerer Niederrhein). Frontier has been asked by these three chambers to look into the impact that an accelerated phase-out would have on competitiveness and security of supply in the Rhineland region.  

The study finds that an accelerated phase-out will lead to substantial challenges. The region can expect a significant impact on the employment market and value added across both the lignite sector and adjacent industries. In addition, the region is – given its high density of energy-intensive companies – particularly vulnerable towards increases in power prices that are to be expected as a consequence of the coal power phase-out.   

Fundamental decisions around energy policy will need to be made, and with its many strengths, the Rhineland area can contribute to successfully shaping these decisions. The area has a comprehensive energy infrastructure, a strong economic structure, numerous energy professionals and an excellent University and research scene. Based on these factors, the area could position itself as a model example for other areas and its experiences could feed into the establishment of similar regions in the future.

Therefore, the Rhineland region is likely to contribute considerably to a successful energy transition process and will help avoid structural breakdowns and keep the need for compensatory measures to a minimum.

Frontier regularly advises  public and private sector clients on energy policy topics.

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