RWE on the outcome of the EU Summit: Germany weakened as a centre of energy production

Full auctioning of emissions allowances disadvantages coal / Growing risk of a "power shortfall"

Essen, (PresseBox) - RWE AG today reacted with grave concern to the climate package agreed by the Heads of State and Government of the European Union. Commenting on the decision to make the EU's energy companies buy all their emissions allowances at auction from 2013 to 2020, RWE Power CEO Dr. Johannes Lambertz remarked that "the EU has failed to create a level-playing field and has greatly weakened Germany as a centre of energy production".

"Security of supply calls for a diverse energy portfolio," he added, lamenting that although coal would be indispensable to such a portfolio, "the EU has seriously curtailed its prospects". Despite the urgent need for power plant renewal, RWE expects that several such projects will now have to be set aside and the modernisation of existing plants delayed. That will raise the risk of a "power shortfall" as well as increasing dependence on gas imports, since the incentive to build gas-fired plants will be all the greater. If faced with a lack of sufficient incentives to build modern coal-fired power plants, energy companies will have no choice but to keep older plants with much higher carbon emissions on the grid."That will benefit neither the climate nor the economy," said Lambertz.

He nevertheless welcomed the decision to invest some of the revenues from sales of emissions allowances in promoting innovative new methods of carbon capture and storage (CCS). RWE is planning to invest more than 30 billion euros in its power stations, open-cast mines and supply networks in the coming years. At least one billion of this total has been earmarked for the first industrial-scale climate-friendly power plant to work with CCS technology. Located near Cologne, this plant is due to come on stream in 2014.

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