German government wants to promote gas-fired power plants - conversion to hydrogen planned
According to reports from last Sunday evening, the German federal government intends to implement the strategy under a new power plant security law. First, power plants with a capacity of five Gigawatts are to be tendered, which must be fully operated with hydrogen starting from the eighth year of commissioning.
Additionally, two Gigawatts of existing gas power plants are planned to be comprehensively modernized, allowing them to be fully converted to hydrogen at a later stage. Furthermore, hydrogen power plants with a capacity of 500 Megawatts are planned, which can run on hydrogen immediately. In case companies do not convert in time within eight years, the newly published key points paper outlines penalties and repayment obligations. Green and blue hydrogen will be promoted.
Moreover, the Ministry of Economics, led by Robert Habeck (Greens), plans to tender five Gigawatts of gas power plants to secure the supply in blackout situations. These power plants will not be hydrogen-ready tendered. However, officials from the Economics Ministry stated that these power plants will have to be open to the new technology in order to achieve climate neutrality by 2045.
The costs of funding were not revealed in the paper. They depend on various factors, particularly the results of the tenders and the development of hydrogen prices. Some measures will be financed from the Climate and Transformation Fund. The financing for the second five Gigawatt-scale gas power plants, however, will come from a levy.
The German Energy and Water Industries Association (BDEW) welcomed the initiative. "The Power Plant Security Law is a decisive building block for a climate-neutral energy supply," explained Kerstin Andreae, Managing Director of the BDEW Executive Board. The law must now be swiftly implemented.
Next, public consultation will be conducted, with six weeks planned for this purpose. Simultaneously, the Ministry is working on the legal implementation of the planned law.
- The Federal Ministry of Economics, led by Robert Habeck, is planning to tender five Gigawatts of gas-fired power plants for securing supply in blackout situations.
- These gas-fired power plants, part of the Ministry's strategy, will not be hydrogen-ready but will have to be open to new technology for achieving climate neutrality by 2045.
- Under the new power plant security law, existing gas power plants with a capacity of two Gigawatts will undergo comprehensive modernization, enabling their conversion to hydrogen later.
- The strategy also includes plans for hydrogen power plants with a capacity of 500 Megawatts, which can operate on hydrogen immediately, contributing to climate neutrality.
- The Federal Government's power plant strategy involves penalties and repayment obligations for companies that fail to convert their gas-fired power plants within eight years, promoting both green and blue hydrogen.
- The Climate and Transformation Fund will finance some measures, whereas a levy will fund the financing for the second five Gigawatt-scale gas power plants to meet climate neutrality goals and ensure security of supply.
