This Wednesday, the European Parliament’s Industry Committee (ITRE) can vote to put an emissions limit on capacity payments, and avoid supercharging coal.

Voting for Compromise Amendment 22A, in the Market Design file, would stop Europe’s dirtiest plants receiving capacity payments. 

Today, we release a briefing showing how capacity payments would interact with a long list of existing ‘policy gaps’ that favour coal. If coal plants get capacity payments, many other urgent interventions would be needed to avoid supporting coal.

The proposed “550” legislation has become one of the more contentious parts of the EC’s Clean Energy Package. A 550gCO2/kWh limit would ensure high carbon intensity power plants don’t get capacity payments, enabling deployment of less polluting and more efficient technologies. We are most concerned by impact of capacity payments on Europe’s 256 operational coal plants, which all have a carbon intensity greater than 550g/KWh.

As we’ve previously shown, if the capacity payments are not limited by 550, coal plants could extend their lives from 40 years to 60 years, so they can stay open into the 2040’s.

In today’s briefing we analyse the impact of “550” legislation on policy interventions. In Section 1 we analyse general EU policies impacting coal; in Section 2 we analyse policies specifically needed to implement a capacity market.

Read the full briefing here.