Germany announces new energy plan

04.04.06 @ 09:46

  1. By Honor Mahony
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The German government announced a new energy plan for the coming years following a meeting of political and industry leaders on Monday evening.

Under the plans, up to €2 billion more will be spent on energy research while more than €30 billion is expected to be invested in building new power plants and distribution networks.

Industry is also to invest €33-€40 billion in renewable energy sources such as wind and solar power.

"We all agreed that the goal must be to gradually reduce our dependence on energy imports and to prevent a rise in energy prices," chancellor Angela Merkel said after the meeting, according to German media reports.

However, nuclear energy remains a divisive issue for the grand coalition of conservatives and social democrats in government.

Mrs Merkel did not elaborate on what kind of power plants would be built, with the previous social democrat government under Gerhard Schroder having agreed a complete nuclear phase-out by the 2020s.

But the phase-out has become much more disputed since early this year when Russia threatened to cut off gas supplies to Ukraine if it did not agree to pay more.

Moscow's move was a wake up call for Germany which relies heavily on Russia for its energy supplies and has resulted in the centre-right Christian Democrats pushing to scrap the decision to move away from nuclear power.

But the Russian action has also been a wake up call for the whole of Europe as Russia supplies over 25 percent of the bloc's gas and oil.

Last month the European Commission published a landmark paper on energy and is pushing to open the energy market by 2007.

EU leaders agreed that they should establish a real single market for electricity and gas by mid-2007, boost renewable energy use by 15 percent and biofuel use by 8 percent by 2015, as well as use 20 percent less energy overall by 2020.

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