The European Commission fears that Germany’s new electricity market reforms will breach EU guidelines by giving environmentally-harmful brown coal power plants special treatment, EurActiv Germany reports. According to a media report, Brussels is not convinced by Minister for Economic Affairs Sigmar Gabriel’s plans for the electricity market.

The report by the Frankfurter Allgemeinen Zeitung on Monday (14 September), which relies on Commission sources, says that the EU’s executive body has concerns that the new electricity market proposals will infringe upon EU guidelines, by providing brown coal (lignite) power plants with special treatment.

The planned transfer of the brown coal plants into a “capacity reserve”, where they will be kept mothballed in order to provide backup power, is clearly a form of government aid. It will require EU approval. Whether the necessary conditions will be met remains to be seen.

So far, the new electricity market proposals envisage placing 2.7 gigawatts of lignite-derived capacity in the reserve, in order for Germany to be able to reach its climate goals by 2020. This will correspond to about five large power plants.

The plants would be shut down, but kept on standby for four years, before being decommissioned completely. In return, the plant operators will be provided with billions of euros, of which mostly the German taxpayer will have to bear the brunt.

Originally, a climate levy for lignite plants was in the offing. A total reduction of 22 million tons of CO2 could have been achieved in this way. Penalties would have been levied against CO2 emissions from coal piles, when producing greenhouse gases above a certain threshold. However, it was opposed by trade unions, suppliers and the economic wing of the CDU. The plan met with opposition due to fears over higher electricity prices and massive job losses in power plants and opencast mining.