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Climate | 15 June 2020

Coal phase-out compensation for LEAG - legality assessment
State Aid
Fossil fuels

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Coal phase-out compensation for LEAG - legality assessment

This report assesses the legality of the compensation agreement arranged between coal company LEAG and the German government, to close its lignite plants and mines as part of the national coal phase-out.

The government is set to grant almost €2bn in public money to LEAG - but the company will potentially keep half of its units online even longer than its projected business as usual scenario in the current economic context.

The report concludes that the compensation faces major obstacles to be approved as a compatible State aid by the European Commission, and elements also appear to violate the EU’s Electricity Markets Regulation.

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