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Sometimes it is for historical reasons, sometimes it is out of necessity. For example, Belgium has an aging nuclear fleet that provides 40% of the electricity
by Joeri 5y ago
Sometimes it is for historical reasons, sometimes it is out of necessity.
For example, Belgium has an aging nuclear fleet that provides 40% of the electricity supply. 5 of the 7 GW of capacity has to be closed down in the coming years. All political parties, the operator and the nuclear safety watchdog organization are in agreement on those 5 GW, but there is still debate on the remaining 2 GW. Regardless of what happens to the 2 GW, the gap in energy supply of the 5 GW needs to be filled, and this needs to happen very quickly.
There is already a planned tripling of renewables, but it will not get done in time, and it will not come even close to covering the gap. The market also wasn't addressing the coming shortfall due to regulatory uncertainty. Previous governments didn't take steps to replace the nuclear fleet, and now Belgium has run out of time and the current government has just a few years to replace the 5 or 7 GW of nuclear capacity. The only solution that was found to keep the lights on was to offer subsidies to the market for building new capacity, and most of the offers received were for gas plants, because in practice that's the only thing that can be built in time. So in practice Belgium now is forced to subsidize fossil fuels or risk the lights going out.
Ironically the gas subsidies will create windfall profits for the wind operators, because prices are set based on the most expensive energy source in the mix, and even with the subsidies that will be gas. So the gas plants will run with a lower profit margin than the wind farms, and this is why Belgium will not be subsidizing renewables as much.
- denton-scratch 5y agoMakes sense, thanks for explaining.