The Coal Trader

Steag coal plant

Germany’s Steag ready to bring back 2.3 GW of coal capacity

The German power generator Steag suggested they’re ready to bring back 2.3 gigawatts (GW) of coal fired electrical capacity to the market for the coming winter, albeit with some caveats. An executive said on Tuesday that financing, logistics, and grid provisions would need to be satisfactory. The main point of contention seems to be in the regulation for returning coal plants to operation, as currently written, states that coal plant utilization can be terminated again before April 2023, depending on the gas supply at that time. Steag is demanding the permissions be prolonged to at least the end of March 2024, and not tied to gas scarcity.

This makes sense from Steag’s point of view. They have to hire and staff up personnel for the operations, and re-initiate a coal supply chain riddled with bottlenecks. To bring these power plants online for only 7 months doesn’t really make much business sense, and Steag wants a longer runway.

This is just another reason/clue as to why I believe the coal market will remain elevated for much longer than most realize. The energy crisis is not going away after one winter. It will take many years to fix the energy supply situation which has been neglected, from an investment standpoint, for almost a decade.

You can read the full article linked here, and below: