Background information

In 2018, the federal government called-in the “Growth, Structural Change and Employment” Commission (“Coal Commission”), an advisory body to prepare and negotiate the coal phase-out in Germany. In particular, it drew up a plan for the gradual reduction and termination of coal-fired power generation in Germany and made concrete proposals for growth and employment in the affected regions. Many social actors from business associations, trade unions to environmental associations were represented in the Coal Commission. The commission adopted its final report almost unanimously on 26 January 2019. On this basis, the federal government adopted the Coal Power Generation Termination Act which foresees that the last coal-fired power plant in Germany will be shut down by 2038 at the latest. Ending electricity generation by burning coal is foreseen to significantly reduce Germany's share of CO2 emissions. The federal government supports structural change in the coal regions with investments on the basis of the Investment Act for Coal Regions and the Federal State-States agreement for Coal Regions

Content of measure

In accordance with the Federal State-States Agreement and the federal Coal Regions Investment Act, the lignite regions will receive federal funds of up to €14 billion until 2038 for particularly significant investments by the relevant states (North Rhine-Westphalia, Saxony, Saxony-Anhalt, Brandenburg) and their affected municipalities. In addition, the federal government supports the regions through further measures within its own responsibility with up to €26 billion by 2038, for example by expanding research and funding programs, expanding transport infrastructure projects, or locating federal institutions there. The states implement the investments on the basis of local economic and structural programmes. Investments are made in projects to support the preservation and creation of jobs and training positions, diversification of the economic structure, and climate and biodiversity protection. In the Rheinish Mining Region, for example, investments are centrally steered by a local development agency in which social partners and other relevant local organisations are are entitled to vote and sit on the supervisory board

Use of measure

In the first report on the evaluation of the Investment Act for Coal Regions from August 2023, the federal government emphasises that due to the short observation period compared to the time horizon of the measures, statements on the impact have so far only been possible to a limited extent. So far, only a relatively small part of the total budget has been spent because many projects are still in the planning stage. However, an overall positive employment development can be observed in the districts in the funding area, although employment in the lignite sector has decreased. A before-and-after comparison (2019 and 2022) shows that the employment rate is increasing slightly in all areas (except the Saxon part of the Lusatian area). According to a descriptive analysis, the funding provided so far by the law has mainly taken place in the areas of research and development, education, and workforce development.

Target groups

Workers	Businesses	Citizens
Applies to all workers	Applies to all businesses	Applies to all citizens

Actors and funding

Actors	Funding
National government Local / regional government	National funds

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	Agreed (outcome) incl. social partner initiative	Agreed (outcome) incl. social partner initiative
Form	Any other form of consultation, institutionalised (as stable working groups or committees) or informal	Any other form of consultation, institutionalised (as stable working groups or committees) or informal

Social partners' role in the implementation, monitoring and assessment phase:

• Social partners jointly
• Main level of involvement: Regional or local level

Involvement

The legislative act was preceded by negotiations in the “Growth, Structural Change and Employment” Commission (“Coal Commission”), an advisory body to the federal government. In particular, it drew up a plan for the gradual reduction and termination of coal-fired power generation in Germany and make concrete proposals for growth and employment in the affected regions. The social partners played a crucial role in the Commission. Other Commission members came from, for example, political bodies or environmental associations. The commission adopted its final report almost unanimously on 26 January 2019. The report was the foundation for the legislative acts regulating all aspects of the coal phase-out.

Views and reactions

From the point of view of the German Trade Union Confederation (DGB), the recommendations of the Coal Commission are exemplary for the sustainable and social shaping of the transformation. It would therefore be important that the federal government largely implements the recommendations of the Coal Commission with the law to create security and prospects for employees and the regions, as well as the basis for a climate-friendly restructuring of the energy industry.

According to the Federal Association of German Industries (BDI) the coal phase-out is an important step for the success of the energy transition. Now special attention must be paid to the accelerated expansion of renewable energies in order to ensure security of supply for companies and private consumers

Sources

• 08 August 2020: Investitionsgesetz Kohleregione (www.gesetze-im-internet.de)
• 27 August 2020: Bund-Länder-Vereinbarung - Kohleinvestitionsgesetz (www.bmwk.de)