German hard coal imports fell 4 percent yr-yr in 2016

FRANKFURT: Germany imported 55 million tonnes of hard coal in 2016, 4 percent less than the 57.5 million in the previous year, preliminary data from coal importers' lobby VDKI showed on Friday.

The figure was down from a summer 2016 forecast by VDKI for imports to remain stable, and reflected a sharper than anticipated fall in usage by power stations of 6.2 percent, and in the heat sector, while steelmakers consumed more coal.

"We estimate that the imports will "only" fall by 4 percent, or 2.5 million tonnes, the reasons for the smaller decline than in power generation being that after years of declines, coal prices rose significantly, prompting inventory build," said VDKI chairman Wolfgang Cieslik.

"We must prepare for pressure (on import levels) to continue over the next few years," he added. Some 41 million tonnes of the import total were steam coal for power plants, 12 million were coking coal for steelmaking, and 2 million coke, a related product, VDKI data showed.

Coal-to-power generation, while losing 2 percent market share in 2016, is still the backbone of German electricity supply in a country set on moving away from nuclear power and favouring renewable energy over fossil fuels. Coal accounted for 40 percent of the power generation total last year, data from industry group BDEW showed.

This was made up of 23 percent derived from domestic brown coal and 17 percent from hard coal, most of which is imported.

Rivalling renewable energy, which is given priority access to power grids, gained 1 percent to 30 percent and competing gas gained 2 percent to 12 percent of the total.

Germany has legislated to become virtually carbon-free by 2050 through a steady replacement of thermal power with that from wind and sunshine, which reduces VDKI's customer base.

Cieslik criticised provisions for gas to be subsidised in municipal heat and power stations which he said had driven the market share gains of gas versus coal, although coal beat gas on price.

He also said that there was injustice in the climate protection efforts demanded by different industrial sectors.

While energy had cut its carbon dioxide emissions by 25 percent since 1990, agriculture had achieved 18 percent and transport none, as the effect of more efficient engines was overridden by heavier cars and rising road transport volumes.

For VDKI notes on the global coal market click here.