Coal plays spoiler in EU clean power deal

Chart Europe's plans for a clean energy pact appeared to stall on Monday after a late proposal to allow governments to extend subsidies to coal-fired power plants.

Energy ministers from European Union countries are meeting in Luxembourg to approve a reform of the bloc's common power market, as part of a plan to shift the continent's electricity system towards cleaner energy. They are also looking at ways to avoid a repeat of last year's energy crisis that left consumers saddled with high power bills

The EU's proposed reform will put new state-backed renewables and low-carbon nuclear plants onto fixed-price "contracts for difference" to make energy prices more stable and predictable. But Reuters reported that a late proposal by Sweden appeared to complicate matters. The Nordic country, which holds the EU's rotating presidency, wants to allow countries to prolong subsidies that pay coal plants to keep enough power generating capacity on standby to avoid blackouts. 

Poland, which generates 70 percent of its power from coal, supported the proposal, and could use it to prolong incentives for coal plants beyond 2025. But ministers from countries including Germany, Belgium, Austria, Spain and Luxembourg have pushed back, pointing out that the proposal could thwart a deal on the overall reforms. 

Europe consumes 2.7 million gigawatt hours (GWh) of energy a year from coal, almost three times as much as solar and wind combined, data from the International Energy Agency shows. Germany and Poland are the bloc's leading users of the fossil fuel.

IEA data shows that generation from the fuel has halved since 1990, falling to 600,000 GWh in 2020 from just above 1.25 million GWh.