Germany approves phase-out of coal mining starting 2009

The energy source that powered Germanys industrial revolution in the 19th century will be phased out starting in 2009. The government approved a plan on August 8 that will bury the unprofitable industry by 2018. The move is expected to cost the government about US$41 billion.

Germanys eight remaining coal mines will be closed by 2018, harsh news for the sectors approximately 35,000 workers.

The government propped up the ailing industry with large subsidies for decades in a bid to preserve jobs. Germanys federal and regional governments have been subsidizing coal mining by up to US$3.2 billion annually.

The deal does not affect Germanys brown (thermal) coal mining sector, which can produce coal more inexpensively because it uses open-pit mines, and will be reviewed by parliament in 2012 to see if it still makes economic sense.

The agreement ensures continued financial support for the sector until the last mine is closed. The government will provide at least US$29.7 billion in further subsidies until 2018.

Production of black metallurgical coal fell to 25.6 million tonnes in 2005, down from 150 million tonnes in 1957 according to German news reports. The number of workers in the industry has shrunk from 166,000 in 1985 to 34,000 today. Last year the countrys eight coal mines produced about 21 million tonnes of coal.

Coal mining has no future declared German Economy Minister Michael Glos on the day of the announcement. A great, long era is coming to an end in a socially responsible way. He said that using cheap imported coal undercuts the expense of heavily subsidizing domestic mining.

Seven of the eight coal plants are in the western state of North Rhine-Westphalia, home to the Ruhr industrial region, and one is in the small state of Saarland on the border with France.

The German magazine Der Spiegel reports that around 20 million tonnes of coal is used to fire power stations and six million tonnes is used in the countrys steel industry. Black coal provides 20% of German electricity, according to 2005 figures.

Critics of the plan argue keeping some of the pits open would prevent dependence on imports. According to the World Coal Institute, Germany was the worlds fifth-largest importer of coal in 2005. But advocates argue there are ample supplies of coal available from politically stable countries and that Germany will have reliable access to it after its mines are closed.