The wheels of German industry, once heralded as the engine of Europe's green transition, are grinding to a halt. On Tuesday, the Federation of German Industries (BDI) warned that a growing number of factories are considering a temporary return to coal-fired power generation, as natural gas prices soar and supplies dwindle. The move, if realised, would represent a significant setback for Germany's climate targets, but the immediate threat to the economy is seen as more pressing.
Germany, already grappling with reduced Russian gas flows, faces a winter where energy rationing looms. The government has activated the second phase of its three-stage emergency gas plan, and industries are being asked to reduce consumption. Yet for many, the cuts are unsustainable.
"The situation is critical," said BDI President Siegfried Russwurm. "We are looking at production stoppages and supply chain disruptions that could ripple across Europe." In response, some companies are dusting off mothballed coal plants or extending the life of those scheduled for closure. RWE, Germany's largest power producer, has already announced it will bring three lignite-fired units back online.
This pivot to coal is a grim irony for a nation that has positioned itself as a climate leader. Germany's Energiewende, or energy transition, aimed to phase out coal by 2038 and reduce emissions by 65% from 1990 levels by 2030. But the current crisis has exposed the fragility of a system too dependent on a single fuel source.
The physics of the situation is unforgiving. Natural gas, which once provided a flexible bridge between coal and renewables, is now too expensive and scarce. Germany's renewable capacity, while growing, cannot yet compensate for the loss of baseload power. Solar and wind are intermittent, and storage technology remains insufficient. The result: a forced regression to the most carbon-intensive fossil fuel.
The environmental cost is immediate. Burning coal for electricity emits roughly twice the carbon dioxide per kilowatt-hour as natural gas. If German coal plants run at full capacity through the winter, the additional emissions could exceed 30 million tonnes of CO2, equivalent to adding 7 million cars to the road. This would make Germany's 2030 climate targets virtually unattainable.
But the urgency is not just about emissions. It is about keeping the lights on and factories running. A widespread industrial shutdown would devastate the economy, leading to job losses and social unrest. The government is now weighing measures to cushion the blow, including subsidies for energy-intensive industries and a possible extension of nuclear power plants beyond their year-end shutdown date.
The crisis has also reignited debate over Germany's nuclear phase-out. Three of the country's six remaining reactors are still operational, but they are scheduled to close by the end of 2022. Some politicians argue they should be kept online to reduce the need for coal. However, the anti-nuclear sentiment remains strong, and the logistical hurdles of re-licensing and refuelling are substantial.
Meanwhile, the energy transition itself is not abandoned. Germany is accelerating the expansion of wind and solar, with new targets for 80% renewable electricity by 2030. But this is a long-term solution to a short-term emergency. The immediate lesson is clear: a rapid transition without adequate buffer capacity leaves a system vulnerable to supply shocks.
For now, German industry prepares for a coal-fired winter, a pragmatic retreat from idealism. It is a sobering reminder that climate action is not linear. Setbacks like these, however painful, may ultimately strengthen the resolve to build a more resilient energy system. But the path forward requires honest accounting: we cannot claim victory over emissions while burning more coal.
The data does not lie. The planet warms regardless of geopolitical crises. And while German industry may survive this winter on coal, the next crisis might be the one we cannot reverse. The question remains: how many steps back until we stop moving forward?
