Dutch government agrees on closure compensation for 731-MW Rotterdam coal plant

The Dutch government has agreed on the closure compensation for the 731-MW Onyx coal-fired power plant in Rotterdam, it said Nov. 30.

Riverstone, the owner of the plant commissioned in 2015, is to receive up to Eur212.5 million ($240 million) to shut the plant and end coal use within two months after certain conditions are met, the energy ministry said in a statement.

"Step by step, we are phasing out coal-fired power stations in the Netherlands and making our energy supply cleaner," acting energy minister Dilan Yesilgoz-Zegerius said.

Closure of the plant would cut annual CO2 emissions by around 3 million mt/year, the ministry said.

Conditions include a social plan for workers and state aid approval from the European Commission's competition authorities.

Security of supply would be guaranteed by the Netherlands' remaining coal plants operating to 2030, the ministry said.

Decommissioning of the plant would take a maximum of three years once conditions were in place, it said.

The cabinet also agreed with operating company Onyx that it would waive previously granted SDE+ subsidies for the co-firing of biomass.

Riverstone acquired the Rotterdam coal plant in 2019 from Engie alongside three German coal units with a total 2.3 GW capacity.

The Rotterdam unit had been offline for much of 2020 due to a technical fault.

Riverstone had earlier indicated its willingness for early closure, while other coal plant operators have threatened legal action over un-compensated 2030 closure decisions.

The rally in gas in 2021 has pushed European coal-fired generation margins to record highs, well above those for gas-fired power plant.

A 45% efficient unit such as Onyx Rotterdam has a profit margin of Eur56.22/MWh for 2022 compared to Eur3.59/MWh for a 50% gas-fired unit based on German year-ahead power, S&P Global Platts data showed.