RWE said it agreed with biogas company Naturdünger Münsterland to stop plans for the biogas plant in Velen, Germany. The German energy company said a renewable energy act in the country makes the planned project uneconomical.
Passed last week, the act cuts back on remuneration rates for biogas and some of the processing bonuses needed to make the project economically viable, the company said.
The Velen biogas plant would have generated as much as 4.2 megawatts of power mostly from the input of manure solids.
The company said in a statement that it, along with its partners, regret being unable to continue with the project because of German laws.
Germany's power sector is struggling to find new footing after the government decided to abandon nuclear power following the Fukushima disaster in Japan in 2012.
The company in May blamed an "extremely mild winter" for its poor performance so far this year. In the first three months of 2014, it sold 67 billion kilowatt-hours of electricity to customers outside Germany, a 6 percent decline from the previous year. Gas sales, meanwhile, were down 19 percent because of weather-related issues.