Coal subsidies ‘should’ end in 2014
Commission calls for hard-coal subsidies to be phased out and uncompetitive mines to be closed.
The European Commission today adopted a proposal calling for an end to government subsidies for hard coal by 2014.
Subsidies would be phased out by 15 October 2014, dropping by one-third every 15 months, and only companies preparing to close their mines would be eligible for state support.
The proposed subsidies would only be what was “needed to ensure the orderly closure” of uncompetitive mines, a Commission spokeswoman said. Some of the money would be used to prepare miners to find other work.
The existing state-aid rules for hard coal, or anthracite, expire on 31 December this year. There is no state aid for soft coal, or lignite.
The proposal will now be discussed by the EU’s 27 member states and by the European Parliament.
The spokeswoman said that the decision on the proposal had been taken “unanimously” by all commissioners after a “thorough debate” that had covered all aspects of the issue, including environmental considerations and the effect on jobs.
The decision is, nonetheless, a setback for Joaquín Almunia, the European commissioner for competition, who has originally proposed that aid could continue to be paid until 2023. Almunia is from Spain, one of three member states with large hard-coal industries. The others are Germany and Poland.
Connie Hedegaard, the commissioner for climate action, and Janez Potočnik, the environment commissioner, were among the commissioners opposed to extending the state-aid rules until 2023. They argued a cut-off date of 2023 would be inconsistent with the EU’s commitment to reducing its greenhouse-gas emissions by phasing out the use uncompetitive fossil fuels.
Poland accounts for more than half of the EU’s hard-coal production. The other half is produced in the Czech Republic, Germany, Romania, Spain and the UK. Around 100,000 people are employed in the EU in the hard-coal industry, with 42,000 working directly in mining and over 55,000 in related industries.
More than 40% of Germany’s electricity is produced from burning coal, with hard coal making up half of the coal supply.