German talks with EU on power plant subsidies progressing - econ min
BERLIN, Aug 1 (Reuters) - Germany's talks with the European Commission on setting up a subsidies framework for hydrogen and gas power plants have made progress, but there is no final agreement yet, the economy ministry said on Tuesday.
Germany wants to use hydrogen and gas power plants to cover renewable energy gaps in future, but has been at odds with Brussels on how to approve these subsidies, which are needed for plants that would be operational only when solar and wind power are not enough to cover the country's needs.
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"We now have the framework along which we will write the power plant strategy for the summer and then conduct a consultation over the fall and then begin tendering next year," Economy Minister Robert Habeck told journalists in Hamburg.
Germany wants future power plant subsidies to be agreed under decarbonisation project guidelines, guaranteeing faster EU approval and more money, Spiegel magazine reported last month.
But the Commission wanted to consider such guidelines only for purely hydrogen plants and advised Germany to apply for gas plant subsidies as energy reserve projects, Spiegel added.
Habeck said talks with the European Commission centred around how long the transition periods with natural gas would be, when the hydrogen ramp-up would take place and what happens if Germany stays with natural gas longer than planned.
"There is a mechanism, that was the complicated thing in the negotiations with the EU, such as if there is not enough green hydrogen, then the remuneration will be adjusted," he added.
Germany will tender 8.8 gigawatts (GW) of new power plants that will run on hydrogen from the start, and up to 15 GW of additional hydrogen power plants that can initially run on natural gas until they are connected to the hydrogen grid by 2035 the latest, Habeck said.
The tender process for 10 GW of these gas- and hydrogen-ready plants would take place by 2026 in a first step, and then the government will do an evaluation of the process before tendering the remaining 5 GW plants planned, he added.
Germany is pushing to phase out coal by 2030 and has reached an agreement with RWE, but concerns over security of supply in eastern Germany have stalled talks on reaching a similar agreement there.
(Reporting by Riham Alkousaa and Jan Schwartz; editing by Matthias Williams, Miranda Murray and Sharon Singleton)