Germany to fight EU hard coal decision

BERLIN, July 23 (UPI) -- Germany is angry that the European Commission wants member states to close loss-making coal mines within the next four years.

"I am not thrilled, to put it mildly," a frowning German Chancellor Angela Merkel said Wednesday in Berlin.

The reason for her frustration is a decision by the European Commission, which Tuesday in Brussels urged member states to close loss-making hard coal mines by October 1, 2014 -- eight years earlier than previously announced. "It would not have been a mistake to speak to the member states once more" before making that decision, a visibly frustrated Merkel said.

The decision, to affect mainly hard coal mines in Germany's Ruhr valley as well as in Spain and Romania, would only allow additional state subsidies for mines if a closure plan is in place. Lignite coal mines are not affected, Brussels said.

Germany in 2007 after long negotiations struck a deal to close its hard coal mines by 2018, an agreement Merkel still sees as valid, she said. Yet inside Merkel's coalition, there are voices that support the Commission's view. Economy Minister Rainer Bruederle said closing hard coal mines earlier makes environmental and economic sense.

The Commission has also defended its plans.

"Companies need to be viable without subsidies. This is a question of fairness vis a vis competitors that operate without state aid," said Commission Vice President Joaquin Almunia. "The Commission will only allow operating aid to mining companies that have a closure plan and the subsidies should go increasingly towards supporting the social and environmental costs of doing so."

Brussels says hard coal production in the European Union is small compared with demand and falling (147 million tons in 2008 or 2.5 percent of global production). Subsidies for the hard coal sector have already fallen from $8.2 billion in 2003 to $3.7 billion in 2008, the commission said. Some 100,000 jobs are linked to hard coal in Europe.

Member states will have to green light the decision before it comes into effect. It won't be a consensus vote; a qualified majority is enough for the commission to get its will.

Yet after Merkel's comments Wednesday, it can be expected that Germany will fight the decision or at least try to influence it in a way. "We will certainly have our opinion heard," Merkel said.