Germany to fire up coal power stations

Move to end dependency on Russian gas comes as leadership rival urges PM to cut energy taxes

Germany is to reopen mothballed coal power plants to combat high gas prices, piling pressure on Boris Johnson to do more in Britain by cutting taxes on household energy bills. The German government will pass emergency laws to reactivate the coal plants as Europe takes steps to deal with reduced energy supplies from Russia. It prompted Tom Tugendhat, the chairman of the Commons foreign affairs committee, to call for a reduction in energy taxes.

GERMANY is to reopen mothballed coal power plants to combat high gas prices, piling pressure on Boris Johnson to cut taxes on household energy bills.

The German government will pass emergency laws to reactivate the coal plants as Europe takes steps to deal with reduced energy supplies from Russia.

Other measures announced yesterday included new incentives for companies to use less natural gas.

It prompted Tom Tugendhat, the chairman of the Commons foreign affairs committee and a potential leadership rival to Boris Johnson, to call for a reduction in energy taxes.

Mr Tugendhat said: “And we’re still charging people extra tax on heating bills. Taxing families when Germany, China and many more simply burn more coal is incoherent. We need to work together and not just reduce emissions at home.”

Alarm has grown over the prospect of fuel reserves running out as countries cut ties with Russia over the war in Ukraine. Last week, the Kremlin reduced flows through the Nord Stream pipeline to Germany by 60pc, as part of an escalating pressure campaign.

Yesterday, Robert Habeck, Germany’s economic minister, said: “To reduce gas consumption, less gas must be used to generate electricity. Coalfirst power plants will have to be used more instead.”

He added that bringing back coal power plants was “painful, but it is a sheer necessity”. It comes as Britain faces soaring energy bills, which are due to increase again later this year with a further rise in the price cap just as the cost of living crisis bites.

The Prime Minister has come under criticism for breaking a pre-brexit promise to cut the 5pc VAT on energy bills paid by households.

Energy bills are on course to surge to as much as £3,000 by the end of the year when the price cap is reset in October to factor in wholesale gas prices up to August.

Last month, the Government enforced a 25pc windfall tax on oil and gas companies to fund support for households.

Analysts at Wood Mackenzie, an oil and gas consultancy, predict Europe could run out of gas supplies by January if the Kremlin turns off the taps.

Prior to the invasion, Russia supplied Germany with just under a third of its gas. Britain relied on Moscow for less than 4pc of its total gas supply in 2021.

Under the plans, Germany will rely more on its coal plants to produce electricity, with a bill to be discussed in the upper house of the country’s parliament in early July.

It is expected to quickly enter law afterwards.

Mr Habeck said that the German government was prepared to take further action if needed.

He added: “We must and we will do everything we can to store as much gas as possible in the summer and fall.”

The move comes after Siegfried Russwurm, president of Germany’s BDI lobby group, said in an interview on Saturday that Germany needed to get coal-fired plants out of reserve “immediately”.

Meanwhile, a new auction system will be introduced to encourage industrial companies to save fuel, which can then be transferred to storage.