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Germany to tighten eligibility rules for coal-to-gas projects in power auctions

By Reuters News

BERLIN, Nov 10 (Reuters) - Germany will tighten the eligibility rules governing conversion projects for existing coal-fired power plants to switch to gas in power capacity auctions, the economy ministry said on Tuesday.

  • The ministry said it will introduce a regulation clarifying when a fuel switch at a coal-fired plant qualifies as a "new build" project and therefore counts towards minimum investment requirements.

  • To ensure that auctions deliver genuinely additional capacity, coal-to-gas conversion projects would only qualify as new build investments if they involve coal-fired units that are already required to shut permanently before 2030.

  • Bidders must invest at least €431,000 ($480,608) per megawatt of eligible capacity.

  • The clarification is intended to prevent operators from claiming investment credit for converting coal plants that would otherwise continue operating beyond that year.

  • It comes after the first auction round, in which utility groups RWE and LEAG secured most of the successful bids. LEAG plans to build new gas-fired plants at existing lignite power plant sites, reusing infrastructure to reduce costs.

  • Germany's energy regulator on Tuesday also formally launched the second auction for long-duration capacity under the scheme. The auction will offer 3,840 megawatts of eligible capacity, with bids due by December 29.


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