EnBW Opens Karlsruhe Coal-Fired Plant

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland) - Germany's third largest electricity utility, Energie Baden-Württemberg AG (EnBW) (Karlsruhe, Germany), has fired up a new coal-fired plant in Karlsruhe in the southwest of the country at a time when power demand continues to fall.

Located in the state of Baden-Württemberg, the Rheinhafen RDK-8 project is a 911-megawatt (MW) plant designed to replace older fossil-fuel fired plants that have been shut down. The plant uses an Alstom STF 100 steam turbine with an Alstom GIGATOP 2-pole hydrogen and water-cooled generator. EnBW currently generates around 4,290 MW from conventional power plants located in the Baden-Württemberg region.

The plant's opening comes a year after EnBW announced it was shutting down four conventional power stations claiming that were too expensive to run. Those on the list included the oil-fired co-generation Unit III and gas turbine III at the Marbach plant and the hard coal power stations 1 and 2 in Walheim. The plants had a combined generating capacity of 668 MW. For additional information, see July 17, 2013, article - EnBW to Shut Four German Power Plants.

At the time, EnBW stated: "Rapid structural change in the energy sector forms the background to this decision. As a result of the marked additional construction of renewable energy sources, numerous fossil plant are exposed to great commercial and financial pressure, and frequently continue to be operated solely as "marginal power plants". This is resulting in a drastic fall in revenue, especially for gas power stations but also older coal power plants and oil-fired systems which can no longer cover their full costs given today's electricity market prices, and can consequently not be operated on a commercially viable basis."

The new RDK-8 plant comes online at a time when renewable energy in Germany has never been stronger. Last month, Germany again broke solar power records when generation topped 23,000 MW in a single day in early June -- representing over 50% of the country's electricity needs. The government is determined to boost renewable energy to 45% of the country's total electricity mix by 2025.

In addition, power demand in Germany has been falling and the commissioning of new coal-fired plants is adding extra capacity that is not needed and driving down profit margins for suppliers.

Last month, EnBW wrote down the value of its power plants by €1.5 billion ($2 billion), warning that earnings from its conventional powers plant fleet -- especially coal-fired plants -- would be eroded by weak prices.

"The reason for the extraordinary charges.... lies in considerably worsening expectations regarding long-term electricity price developments," EnBW stated in recent weeks. "The futures market prices have continuously plummeted since the second six-month period 2012, from about €50/MWh to under €40/MWh during 2013, and in the course of 2014 to by now less than €35/MWh. An improvement of the market situation is not to be expected in the medium term. Therefore it is to be assumed that the electricity price level will continue to be low over the next few years, which will significantly lower the potential future earnings from EnBW's generation capacity, specifically from coal-fired power stations."

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