Germany’s first auction for gas-fired power plants may be delayed until 2025

The first auction for gas-fired power plants, which are expected to begin operating by 2030, is likely to be delayed until 2025. The reason is ongoing discussions with the European Commission, including over whether the proposed measure complies with state aid rules. This was reported by the international outlet S&P Global.

Germany announced plans for a total of four auctions to support gas-fired power plants with a combined installed capacity of 10 GW in February this year. The plants should be commissioned before 2030, enabling the planned phase-out of coal-fired power plants while ensuring security of electricity supply.

According to the original plans, the first tender was to be launched this year. To do so, however, Germany must obtain approval from the European Commission, which it has not yet managed to secure. Economy Minister Robert Habeck said that discussions with the Commission are taking place practically every day. In addition to compliance with state aid rules, they are also addressing whether the proposed measure is necessary in light of the planned pace of the coal phase-out.

Last week, reports emerged that Germany had received informal approval for its proposed support scheme. However, no further details were made public.

Uncertainty concerns developers and opposition

Uncertainty over the timetable and final form of the planned measure is a concern for opposition parties, among others, which are warning of risks to the planned phase-out of coal by 2030.

“As things are developing, we will be using coal and operating coal-fired power plants beyond 2030, perhaps even beyond 2038. It is remarkable that the ‘green’ energy minister accepts this risk,” said Jens Spahn of the opposition CDU/CSU.

Barbie Kornelia Haller, vice-president of the German regulator, is somewhat more optimistic. She said that once the European Commission has approved the measure, preparations for the auctions could proceed relatively quickly.

“We want a stable, long-term legal framework. As soon as we have it in the parliamentary process, we will start preparing the auction parameters. They must be ready very quickly. We will work hard to publish them at the beginning of next year,” she added.