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

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) Pao-Yu Oei - 0 - 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“ Pao-Yu Oei - 1 - 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. Coal (& steel) historically played a Coal used to generate crucial part for the EU in terms of its 41 % of global electricity. creation, employment, its economy, etc. Coal was used in Paris Agreement 70 % of global steel production. entered into force in November 2016 Coal was responsible for 39 % of total EU ETS emissions. How can a reduction in coal consumption in line with the 2°C target be achieved in the EU? Sources: Le Quéré et al. (2015), WorldCoal (2017), Carbon Brief (2017). Pao-Yu Oei - 2 - 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“ Pao-Yu Oei - 3 - 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 2029 2022 2030 2025 2029 2025 2035 ? 2016 2021 2025 2025 2030 Source: CAN database / Sandbag (2016); Europe beyond Coal (2018) Pao-Yu Oei - 4 - CoalExit Group; DIW Berlin and TU Berlin

Coal power plants & emissions of CO 2 , PM, Nox, SO 2 in Europe Source: EC-JRC (2018). Pao-Yu Oei - 5 - CoalExit Group; DIW Berlin and TU Berlin

Projections for coal power plants in Europe 2016-2030 Source: EC-JRC (2018). Pao-Yu Oei - 6 - CoalExit Group; DIW Berlin and TU Berlin

Necessity to phase-out coal vs. current status quo. United Kingdom Germany Poland • Installed coal capacity: • Installed coal capacity: • Installed coal capacity: 15 GW. 49 GW. 27 GW. • Import dependence coal: • Import dependence coal: • Import dependence coal: 88%. 45%. -8%. • EU’s 1 st hard coal & 2 nd • First country to mainly • Biggest lignite producer use fossil fuels (steam globally, biggest hard largest lignite producer. engine 18 th century). coal importer EU. • Bad mining conditions, • Coal consumption fell • Commission on coal domestic coal more from 39% (2012) to 2% phase-out plans and expensive that imports. (2017). transition started its work • Expansion plans for coal in June 2018. • Coal phase-out: by 2025. mines and power plants. Sources: See references pictures and relevant references at the end of presentation. Pao-Yu Oei - 8 - 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. Pao-Yu Oei - 9 - CoalExit Group; DIW Berlin and TU Berlin

Effect of a coal phase-out on employment in Europe Source: EC-JRC (2018). Pao-Yu Oei - 11 - CoalExit Group; DIW Berlin and TU Berlin

Renewable Energy potential in coal mining regions Source: EC-JRC (2018). Pao-Yu Oei - 13 - 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“ Pao-Yu Oei - 14 - 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 Pao-Yu Oei - 15 - 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 Pao-Yu Oei - 16 - CoalExit Group; DIW Berlin and TU Berlin

Development of coal and RES employment and electricity share in Germany from 1980 to 2017 Pao-Yu Oei - 17 - 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“ Pao-Yu Oei - 18 - CoalExit Group; DIW Berlin and TU Berlin

Reduction of German coal power plants in line with 2° target Pao-Yu Oei - 19 - CoalExit Group; DIW Berlin and TU Berlin

The carbon lock-in of coal regions and actors originates from various sources Pao-Yu Oei - 20 - CoalExit Group; DIW Berlin and TU Berlin

Theory Lessons learnt – enabling a ‘just transition’ Multi-level, polycentric governance and planning Participation & consensus of relevant stakeholders National or supranational (structural) policy level Regional (structural) policy level Workers & Citizens Social security and pension system Economy & Industry Decen- Fossil tralized fuel- renewable Finance based Infrastructure energy economy system Education & Research facilities Soft location factors Energy system Pao-Yu Oei - 21 - CoalExit Group; DIW Berlin and TU Berlin

So who is in charge of managing a coal phase-out Putting it into practice; e.g. in Germany 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 Pao-Yu Oei - 23 - 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- out 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. Pao-Yu Oei - 24 - 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) Pao-Yu Oei - 25 - 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). Pao-Yu Oei - 26 - CoalExit Group; DIW Berlin and TU Berlin