Russian gas shutdowns spur Uniper to restart coal-fired power plant

• The German energy group Uniper announced that it would put a coal-fired power plant back into operation to generate electricity.
• The plant will provide electricity from Monday to April next year after Russia halted gas supplies to the country.
• Europe is facing a major energy crisis and the supply of coal signals is under pressure.

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German utility giant Uniper said it will restart a mothballed coal-fired power plant to generate electricity after Russia cut gas supplies to the country again.

The Düsseldorf-based company, which is Europe’s biggest buyer of Russian gas, said it would temporarily ramp up the Heyden 4 coal-fired power plant to generate electricity from Monday. It is expected to supply electricity until the end of April 2023.

Uniper’s switch to coal after ending operations in 2020 to mark the end of its decarbonization plan underscores what one analyst has called a “scary” energy shortage in Europe, as Russia cuts gas supplies and heatwaves spur demand.

In a surprise move on Friday, Russia’s state-owned energy giant Gazprom said it would halt Nord Stream 1 gas flows to Germany for three days while the pipeline undergoes maintenance. Pipeline flow has already been reduced to just 20% of capacity.

Europe’s energy crisis has left several regional leaders fearful of winter as supplies run short, and some officials have accused Moscow of using energy in retaliation for Western sanctions imposed after Russia invaded Ukraine.

European natural gas prices surged nearly 20% to new record highs on news of Nord Stream 1 disruption, and energy concerns are worrying other financial markets.

The move to revitalize Heyden 4 was prompted by a German law passed to ensure energy security, Uniper said. The law provides for a gas ban and calls for the switch to coal-fired power plants to generate electricity.

“It appears that demand destruction remains the most obvious yet painful cure right now, along with a longer-term focus on ensuring broad-scale energy supplies from coal, gas, nuclear, solar, hydrogen and more,” analysts at Saxo Bank said in a note Tuesday.

If the law were extended, the Petershagen plant could produce electricity for another year beyond next April, Uniper said.

The “intended operation of Heyden 4 will be limited due to restrictions on rail transport capacity from bituminous coal to the site, which could be lifted as additional transport capacity becomes available,” it noted.