Ahead of the next trilogue on the Electricity Market Design on 11 September, France, UK, Italy, Greece, Hungary, Ireland and Poland have just issued joint comments on the new rules regarding capacity mechanisms, which stand in stark contradiction to their commitment to fully implement the Paris Agreement.
The reformed rules for capacity mechanisms are aimed at ensuring that neither existing nor new coal power plants will be allowed to receive state subsidies in order to keep them on stand-by.
However, the Member States who have signed this non-paper are asking that the new rules would not apply to the contracts concluded before the rules enter into force. They also ask to push back for the existing plants the implementation of the emission performance criterion (the 550gCO2/kWh rule), which is meant to end subsidies for the most polluting plants.This could lead to coal plants still receiving public money through capacity mechanisms for the next decades, a situation that stands in stark contradiction with the objectives of the Paris Agreement.
Joanna Flisowska, Coal Policy Coordinator at Climate Action Network (CAN) Europe, said: “It is shameful to see France, Italy and the UK backing up Poland’s desperate efforts to secure subsidies for their coal plants through capacity mechanisms. If these countries help Poland to get its way, coal plants in Europe would continue to receive state subsidies until the late 2030s.”
Such a stance would delight the Polish government in particular, which is pursuing a new 1GW coal plant Ostroleka C as well as three rounds of auctions for capacity payments to secure massive subsidies for its coal plants before the new rules come into force. Analysts say that the Ostroleka C project would be unprofitable and cause a loss of 1,7 billion euros.
Joanna Flisowska added: “France, Italy and the UK as members of the Powering Past Coal Alliance which calls upon an EU-wide coal phase out by 2030, should be supporting the European Parliament and the Commission in their position to end coal subsidies and ensuring that also existing capacity mechanisms are aligned with that. Signing the Paris Agreement is not enough, it needs to be backed up with action.”
Nicolas Derobert, CAN Europe Communications Coordinator, firstname.lastname@example.org, +32 483 62 18 88
Climate Action Network (CAN) Europe is Europe's leading NGO coalition fighting dangerous climate change. With over 150 member organisations from 35 European countries, representing over 1.700 NGOs and more than 40 million citizens, CAN Europe promotes sustainable climate, energy and development policies throughout Europe.