Minister eyes German energy transition 'reality check'

: Electricity, Hydrogen
25/05/09

Germany's energy transition needs a "reality check", the country's new energy minister Katherina Reiche has said, stating that the government will prioritise security of power supply over climate protection.

The government must strike the right balance between climate protection, security of supply and costs, Reiche said at the Ludwig Erhard Summit earlier today, arguing that the focus in recent years has been disproportionately on the former. The new government will put security of supply "first", while also focusing on keeping system costs — such as redispatch and grid expansion costs, which previous governments "underestimated" — as low as possible.

The government is aiming to "quickly" hold tenders for the construction of "at least" 20GW of new gas-fired capacity, Reiche said, citing the recent blackout in the Iberian peninsula as evidence that Germany cannot become complacent over its power supply. While she acknowledged that the reasons for the blackout are not yet fully determined, she said that a lack of inertia in the power system is likely to have contributed to it, and that more flexible gas-fired plants "could have helped" Spain avoid the blackout. She called for Germany to agree "long-term delivery contracts" for natural gas, to ensure security of supply in the coming years.

And Reiche emphasised the importance of "technology openness", particularly when it comes to Germany reaching its goal of becoming climate-neutral by 2045. There may be new technologies that are yet to be invented or fully harnessed that could aid the country in fulfilling its goal, she noted. Hydrogen has the potential to play a role in a "mix" of other technologies in the energy transition, she said, but the expectations for it have become too high for a product that is "not even on the market".

Reiche also called for more patience with regard to electrification in Germany, stating that "the transformation of an entire economy [to become climate friendly] in a linear, year-on-year path is not feasible".

And the minister reiterated previous CDU/CSU-SPD coalition pledges to reduce the electricity tax and to introduce an industry power price.

CDU party member Reiche became the new energy minister on Tuesday, when CDU leader Friedrich Merz was voted in as chancellor, replacing the SPD's Olaf Scholz.

By John Horstmann

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25/06/20

Pakistan loses EU GSP+ ethanol status

London, 20 June (Argus) — The European Commission today suspended Pakistan's Generalised Scheme of Preferences Plus (GSP+) status for imports of ethanol. The removal is effective from today, 20 June. A request was lodged in May last year by France, Germany, Spain, Italy, Hungary and Poland, who sought to activate Article 30 of the GSP Regulation, arguing that ethanol coming from Pakistan since 2022 has "caused a serious disturbance to the Union ethanol market". Under Article 30, the commission can "adopt an implementing act in order to suspend the preferential arrangement in respect of the products concerned". Pakistan was granted GSP+ status in 2014, and this expired at the end of 2023. The status was temporarily extended until 2027. The GSP+ grants reduced-tariff or tariff-free access to the EU for vulnerable low- and lower- to middle-income countries that, according to the EU, "implement 27 international conventions related to human rights, labour rights, protection of the environment and good governance". It fully removes custom duties on two-thirds of the bloc's tariff lines in Pakistan's case, including ethanol. Pakistan is a major supplier of industrial-grade ethanol to Europe, but it does not export fuel-grade ethanol. According to market participants, this is because production facilities in the country lack sustainability certifications such as the International Sustainability and Carbon Certification (ISCC) that are required for biofuels to qualify under the EU Renewable Energy Directive (RED) targets. Fuel-grade ethanol was not included in the bloc's measures. Several Pakistani market participants were hopeful the GSP+ status will remain in place, which has continued to support ethanol exports from the country to the EU ( see table ). But uncertainty has weighed on demand from Europe recently, suppliers said. A participant told Argus that Pakistani sellers may look to offer more into Africa to soften the drop in demand. Some European suppliers anticipated this outcome, and have already stopped importing from Pakistan. European renewable ethanol association ePure expressed concern about the decision to exclude fuel ethanol from the scope of the measures, noting this could open the door to unintended loopholes and weaken the overall effect of the safeguard efforts. By Evelina Lungu and Deborah Sun European ethanol imports from Pakistan Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

ArcelorMittal halts DRI-EAF projects in the EU

25/06/20

ArcelorMittal halts DRI-EAF projects in the EU

London, 20 June (Argus) — Luxembourg-based steelmaker ArcelorMittal said it will not proceed with previously announced direct-reduced iron (DRI) and electric arc furnace (EAF) decarbonisation projects at Bremen and Eisenhuttenstadt in Germany. The company cited unfavourable policy and slower than expected progress in the energy transition — particularly the lack of commercially viable renewable hydrogen. The company initially planned to supply DRI from Bremen to the EAF in Eisenhuttenstadt after their construction. ArcelorMittal first announced the plans in 2021, projecting that the two sites could produce up to 3.5mn t/yr of steel using renewable hydrogen by 2030. The company initially planned to use natural gas for DRI production in Bremen and gradually switch to renewable hydrogen. But in November last year, the company said it was unable to take final investment decisions on building the DRI-EAF assets in the EU because of challenging energy, policy and market environments that were not moving in a favourable direction. The projects were slated to receive €1.3bn ($1.5bn) in subsidies from the German federal government, contingent on construction beginning by June 2025. Even with that support, the business case remains too weak, ArcelorMittal Europe chief executive Geert van Poelvoorde said. The company has formally notified the government it will not be taking the subsidies. "This decision underlines the scale of the challenge. As it stands, the European steel industry is under unprecedented pressure to stay viable — without factoring in the additional costs required to decarbonise," Poelvoorde said. It remains unclear what the company's decision means for its related partnerships with German utility RWE and US-based Plug Power. ArcelorMittal and RWE announced plans in 2022 to identify locations for electrolysis plants to supply renewable hydrogen to the steelmaker's Bremen and Eisenhuttenstadt sites, starting with a 70MW pilot facility by 2026. In a separate agreement in 2023, Plug Power committed to supply two 5MW electrolysers to utility SWB for ArcelorMittal's green steel feasibility project at Bremen. The company has urged the EU to accelerate enforcement of the carbon border adjustment mechanism, strengthen trade protections and implement the EU Metals Action Plan to restore the competitiveness of low-emissions steel. In May, ArcelorMittal confirmed its intention to invest €1.2bn in a new EAF at its Dunkirk site in France. Market participants suggest the company was delaying its DRI investments in Ghent, Belgium, and Dunkirk, but the steelmaker has yet to comment. The French government in 2023 approved an €850mn grant to ArcelorMittal to decarbonise its Dunkirk asset. ArcelorMittal's move comes as other steelmakers in Germany also reassess their decarbonisation timelines. Thyssenkrupp, for instance, has warned that its planned DRI plant in Duisburg — expected to switch from natural gas to hydrogen — may not be economically viable under current conditions. By Elif Eyuboglu and Akansha Victor Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Germany plans €17,000/t e-SAF penalty

25/06/20

Germany plans €17,000/t e-SAF penalty

Hamburg, 20 June (Argus) — Germany is planning to impose penalties of €17,000 for each tonne that fuel suppliers fall short of their hydrogen-based synthetic aviation fuel (e-SAF) obligations, under a draft bill implementing the EU's revised Renewable Energy Directive (RED III). The draft, seen by Argus , allows for the penalty level to be adjusted in future. The EU's ReFuelEU Aviation legislation mandates e-SAF blending from 2030. Fuel suppliers must ensure that e-SAF makes up at least 1.2pc of their overall aviation fuel supply on average in 2030–31, with a minimum of 0.7pc each year. The share rises to 2pc in 2032, 5pc in 2035 and 35pc by 2050. Member states are required to set penalties at least twice the price difference between e-SAF produced from renewable hydrogen and conventional jet fuel. Reference prices published by the European Union Aviation Safety Agency earlier this year implied minimum penalties of €13,922/t. Germany's proposed €17,000/t penalty would significantly exceed that level. E-SAF can be produced using renewable or non-fossil low-carbon hydrogen, such as hydrogen from nuclear-powered electrolysis. The legislation also permits the direct use of hydrogen in aviation, although this is widely seen as a longer-term prospect. Germany had previously proposed its own national e-SAF quotas but scrapped those plans following the introduction of EU-wide mandates. Most planned e-SAF production facilities in Europe and globally remain in early development stages. Industry participants have repeatedly called for greater regulatory clarity — including on penalties — and additional support to unlock final investment decisions. By Stefan Krumpelmann Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

French Bugey nuclear cuts likely from 25 June: EdF

25/06/19

French Bugey nuclear cuts likely from 25 June: EdF

London, 19 June (Argus) — High temperatures on the River Rhone are "likely" to drive production cuts from nuclear plants along the river, especially Bugey, according to French utility EdF. The potential cuts will be reviewed on 24 June, and a specific publication will detail the cuts if they are confirmed, EdF said. France is about to see a combination of a heatwave and dry spell, with daily highs in Grenoble forecast to remain mostly above 30°C until the beginning of July. The combination of heat and a lack of rain in the Alps has increased the chance of hotter water and lower flows on the Rhone, which could have a knock-on effect on France's nuclear fleet. Eight of the country's 57 reactors discharge their cooling water directly into the river, and environmental regulations limit the temperature at which they can do this, meaning if the river's flow is low and temperatures high, the units can be forced to reduce output. Flows out of Lake Geneva — where the Rhone leaves Switzerland and enters France — have remained at 239-328 m³/s since 2 June. Earlier in the month this was within the 25th to 50th percentile of historical values, but is now slightly below the 25th percentile, as flows typically increase in June to peak at the end of the month and into July. The low outflows are reflective of low inflows, as the lake's level is regulated by the Seujet dam at the lake's exit to the Rhone, which keeps its level about 1m all year. The lake's level typically falls in the first quarter and rises in the second to a peak in June and July, and the level has been creeping up over June in line with the historical trend. The outflow's average temperature of 20.9°C on Wednesday was between the 75th and 95th percentile for the date. A convention between France and Switzerland guarantees that the flow of the Rhone upstream of Bugey, the first nuclear plant on the river, is to remain above 150 m³/s, with the potential for release of water from the Emosson reservoir in Switzerland to the Arve River to achieve this. In recent days, flows at Bugey — combining outflows from Lake Geneva and tributaries of the Rhone, which have brought more than 100 m³/s — have been well above this minimum. And thermal limits for Bugey are set at a maximum temperature downstream of the plant of 26°C and a maximum temperature difference between upstream and downstream of 5°C. If grid operator RTE determines that the plant is necessary to maintain supply, this maximum limit can increase to 27°C, but with only a 1°C temperature difference allowed. Only two of Bugey's four units discharge their cooling water directly into the Rhone, with the other two using cooling towers, which sharply reduce their thermal impact on the river, and so the extent to which the regulations affect them. If water flows were at their minimum of 150 m³/s, and at a temperature of 21°C upstream of the plant, this stream would have the capacity to carry 3.14GW of waste heat away from the plant before hitting the regulatory limit of 5°C of temperature difference and 26°C maximum temperature downstream. This is less than the roughly 3.8GW of waste heat generated by Bugey 2 and 3 operating at full power, including their thermal power of 5.6GW less their electrical power of 1.8GW. Bugey 4 and 5 contribute a small amount of extra waste heat downstream, as their cooling towers do not completely eliminate waste heat. Both units have had to stop at moments in the past two years because of heat-related constraints. In the last period when Bugey was constrained, in mid-August, flows leaving Lake Geneva were significantly hotter than now, roughly 24-26°C. At that point, output from Bugey 2 was reduced to zero, before a sharp fall in water temperature to roughly 20°C by 18 August allowed constraints to be lifted. But air temperatures in the region are forecast to remain elevated for the next two weeks, which will boost water temperatures over time. Daily highs in Sion, Switzerland, are seen at 3-4°C above the norm through to the beginning of July. Temperatures and flows at reactors further downstream which do not possess cooling towers — 2.6GW Saint Alban and 3.6GW Tricastin — are affected by other flows on tributaries to the Rhone, which cool the river down and increase its volume after passing Bugey. By Rhys Talbot Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

TC Energy targets brownfield expansion growth

25/06/18

TC Energy targets brownfield expansion growth

Washington, 18 June (Argus) — Canada-based TC Energy intends to focus on expansions of its existing natural gas pipeline network in North America to serve growing demand for natural gas service until the mid-2030s, chief executive Francois Poirier said today. TC Energy has a $32bn backlog in capital projects and is looking at an additional $30bn of projects that may not all come to fruition, Poirier said. The company's focus is on increasing capacity through existing pipelines and pipeline corridors, he said, rather than pursuing greenfield projects that require entirely new routes. "Our view is that we're going to be able to prosecute all of that with brownfield expansions," Poirier said in an interview on the sidelines of the Atlantic Council's Global Energy Forum. "The industry has been quite innovative in finding the nooks and crannies to move gas around. So I don't see a need for a big greenfield pipeline until the mid-2030s." Pipeline developers since 2020 have prioritized brownfield projects, after permitting delays and lawsuits delayed or halted proposed pipelines across the eastern US, such as the now-canceled $8bn Atlantic Coast Pipeline. President Donald Trump has pushed to restart new pipeline development, and last month US midstream operator Williams said it was restarting work on the 124-mile (200km) Constitution pipeline and the Northeast Supply Enhancement project. Last month, TC Energy announced a $900mn expansion of its ANR pipeline system in the US Midwest, known as the Northwoods project. TC Energy will focus on those types of brownfield projects until at least the mid-2030s, Poirier said, when the company forecasts gas production in the Hayettesville and Permian basins will reach maturity. At that point, he expects there will more need to transport Appalachian gas to the US Gulf coast, where demand from LNG export terminals is set to increase. "Then the question is going to be, is it economical?" Poirier said. "It's going to depend on the price for Henry Hub [gas]. Right now, the Henry Hub price doesn't support a new greenfield pipeline." Data centers are among the largest drivers of demand growth, Poirier said. In the last three months, TC Energy has seen "quite an acceleration" in demand for gas transportation service from utilities serving that demand, he said. Gas-fired plants are still the fastest way to reliably serve those data centers even though such plants take 3-5 years to build, he said, because renewable power is intermittent and nuclear plants take at least a decade to build. "If you look at the 660 or so data centers under development and construction in the US, about two-thirds are within 50 miles of our pipelines," Poirier said. By Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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