Merkel 'not thrilled' by EU bid to end coal subsidies

21st July 2010, Comments 0 comments

German Chancellor Angela Merkel said on Wednesday she was "not thrilled" by a proposal by Europe's top competition enforcer for national governments to end state aid to the coal industry by 2014.

"I think it would not be a bad idea to talk about it again with the member states," Merkel said at a wide-ranging press conference before her summer vacation. "I am not thrilled."

EU competition commissioner Joaquin Almunia said on Tuesday he wanted the 27-member bloc to end state aid to the coal industry eight years earlier than initially sought in a bid to close uncompetitive mines by October 2014.

The existing subsidy regime for the coal industry was due to expire at the end of this year. Almunia's proposal would need the approval of the European Council.

Europe is responsible for just 2.5 percent of world hard coal production, and is increasingly moving towards renewable sources alongside nuclear energy.

Germany has six coal mines still in operation which employ 27,000 people and receive about two billion euros (2.6 billion dollars) in annual state subsidies. Three of the mines are slated for closure.

The RAG group, which operates the German mines, "assumes that the German government will do everything in its power" to maintain production until 2018, a spokesman said.

© 2010 AFP

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