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The World’s Dumbest Energy Policy

Editorial, The Wall Street Journal

After giving up nuclear power, Germany now wants to abandon coal.

Dumb environmental policies are routine across Europe—see Emmanuel Macron’s riot-inducing fuel tax in France—but even by that standard Germany’s new plan to abandon coal is notable. Having wasted uncountable billions of euros on renewables and inflicted some of Europe’s highest energy prices on German households and businesses, now Berlin is promising to kill the one reliable power source Germany has left.

That plan comes via a blue-ribbon commission that recommended over the weekend that Germany phase out coal-fired power generation by 2038. Coal currently accounts for 40% of Germany’s electricity, by far the highest proportion in northern Europe. To the extent this is creating an environmental crisis, it’s a result of more than a decade of bad green policy choices.

The energiewende, or energy transformation, championed by Chancellor Angela Merkel heavily subsidizes unreliable wind and solar power, making it uneconomical for utilities to invest in cleaner natural gas. Meanwhile, Mrs. Merkel pledged to shutter German nuclear plants in the wake of Japan’s 2011 Fukushima disaster. Utilities have fallen back on cheaper but dirtier coal to fill the supply gaps when the wind doesn’t blow or the sun isn’t shining.

Not that a new coal ban will help much. Critics such as Karen Pittel of the Ifo think tank in Munich note that Germany is likely to import coal-fired electricity from Poland and the Czech Republic. And whatever Germany does to keep the lights on, the coal phase-out involves more green subsidies—some €40 billion to compensate utilities for prematurely closing coal-fired plants, the commission estimates.

Mrs. Merkel’s government is expected to approve the commission’s plan. But her tenure as Chancellor will end long before coal-fired electricity does. Her successor will have an opportunity to call time on Mrs. Merkel’s green follies, and Germany’s beleaguered bill-payers should hope that he or she does.

The Wall Street Journal, 30 January 2019