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Energy giants lose bid to win compensation for forced coal plant closures

Thursday, December 1st, 2022

Uniper and RWE lost a bid to get compensation from the Netherlands government over the forced early closing of their coal plants in the country.

A Dutch court ruled Wednesday that the energy giants weren’t entitled to payouts after the country adopted a law in 2019 that ordered all coal plants to stop burning the dirtiest fossil fuel by 2030 in order to cut emissions fast enough to fall in line with climate change pledges.

“It is an important day for the climate,” Rob Jetten, Dutch Energy and Climate minister, said in a statement. “We continuously stated this measure is necessary because the operators showed too little initiative to make their coal plants more sustainable. It is good we have clarity now.”

The companies said that the Dutch government invited them to build coal-fired plants and therefore deserve to be compensated for the lost profits. The government argued that the coal-fired power plants were already making a loss and that the companies are seeking compensation for bad investments. RWE alone was seeking €1.4-billion ($1.4-billion). Uniper never disclosed how much compensation it was asking for.

A total of four coal plants are still in operation in the Netherlands of which, Uniper and RWE own two. Uniper’s Maasvlakte plant was opened in 2016 and RWE opened its plant in Eemshaven back in 2015.

This ruling doesn’t spell the end for the battle between the firms and the government. Both companies began suits via the international investment pact the Energy Charter Treaty with a verdict expected early next year. In October, Jetten announced the country’s intention to leave the ECT as it clashes with international climate goals.

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