RWE, a German energy company, will burn more coal in the short term, its chief financial officer said on Thursday on CNBC, but he insisted that the company’s long-term plans to be carbon neutral will not change.
With the war in Ukraine still going on, Michael Muller’s remarks come as European nations struggle to secure their energy supplies.
According to Eurostat, Russia was the EU’s main supplier of both natural gas and petroleum products in 2017. Since the Kremlin was subjected to sanctions by Western countries as a result of its unprovoked invasion of Ukraine, natural gas flows to Europe have been significantly reduced.
Germany, the biggest economy in Europe, has decided to shut down some of its coal-fired power plants in an effort to make up for the lack of Russian gas.
Muller told CNBC’s Joumanna Bercetche that “RWE is actively supporting the German government, or European governments, in managing the energy crisis.” Therefore, in order to handle that situation, we are also bringing back more coal capacity.
Three lignite-fired power plants owned by RWE will be brought back online starting in October as part of this plan.
According to RWE, Lignite, Also Referred to as Brown Coal
According to RWE, lignite, also referred to as brown coal and thought to be especially harmful to the environment, “remains a reliable partner to this day.” Additionally, it states that RWE Power, which concentrates on lignite and nuclear power generation, mines millions of metric tonnes of coal annually.
The company, which has its headquarters in Essen, faces a challenge because it wants to achieve carbon neutrality by the year 2040.
Coal is a fossil fuel that has a significant impact on the environment and is referred to by Greenpeace as “the dirtiest, most polluting way of producing energy.” Carbon dioxide, sulphur dioxide, particulates, and nitrogen oxides are just a few of the potentially hazardous emissions that coal combustion produces.
According to Müller of RWE, “What is happening now is… hopefully a short-term issue where we need to find the security of supply.”
And because of this, he continued, “we feel it is our responsibility as corporate citizens to support the German government in restoring capacity in the short term — but to be very clear, it doesn’t change our strategy.”
Therefore, even though we must burn more coal in the short term, it must be made clear that the development of renewable energy sources must be accelerated in order for us to still meet our medium- and long-term goals. RWE released its first-half 2022 financial results on Thursday. Adjusted net income was 1.6 billion euros ($1.66 billion), up from 870 million euros in the first-half 2021.
The business claimed that in the first half of 2022, it had invested about 2 billion euros in growing its green portfolio. By the end of 2022, “Total investments will reach more than 5 billion [euros],” it continued.
According to the report, improved wind conditions and increased capacity resulted in a 20% increase in the amount of electricity produced from renewable sources during this time frame compared to the first half of 2021.