Vattenfall open to talks on Hamburg coal power plant's future amid elections

London — Vattenfall is open to talks on the future of its 1.6-GW Hamburg-Moorburg coal plant after a surprise proposal by the city's mayor ahead of Sunday's election, the Sweden-based utility said Thursday.

Hamburg's governing mayor, Peter Tschentscher of the Social Democrats (SPD), Thursday presented a plan to shut one coal unit at the plant and convert the second to gas, in addition building a 100-MW electrolyzer to produce green hydrogen at the site.

The relatively new coal plant, commissioned in 2015, is currently expected to continue operating until Germany's mandated coal exit deadline of 2038.

In a statement, however, Vattenfall said the plant did not fit its strategy of decarbonization within a generation.

"Aside from a fuel switch, the option of selling the asset cannot be ruled out," it said.

"The idea by Peter Tschentscher to close Moorburg earlier than planned, partially convert to gas and produce green hydrogen on site is a strong signal for climate protection," said German environment minister Svenja Schulze.

The minister has been calling for green hydrogen production in Germany with the government considering a 20% quota in the national hydrogen market by 2030.

Vattenfall had been looking at green hydrogen solutions in Hamburg and Berlin, where it also has assets, it said.

The future of the coal plant has been a prominent issue in the Hamburg state elections with the SPD expected to continue in coalition with the Greens, who have made ground in recent polls.

Hamburg's economy senator Michael Westhagemann last year called for a 100-MW electrolyzer in the port city.

The project would cost a hundreds of millions of euros and would be funded by subsidies from the German government and the EU, with Hamburg providing land for the facility, he said earlier.