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The European Commission has opened formal investigations into compensations provided to RWE (EUR 2.6 billion) and LEAG (EUR 1.75 billion) for the closure of lignite plants in Germany by 2038. The Commission preliminarily concludes these payments constitute state aid and expresses doubts regarding their proportionality, specifically whether the calculations for foregone profits and mine rehabilitation costs are realistic or lead to overcompensation. ClientEarth argues that the aid may violate the 'polluter pays principle' regarding mine recultivation and that declining market conditions and rising CO2 prices make the assumed long lifespans of the plants unrealistic.

The document examines the 2018 establishment of Germany's "Coal Commission," which aimed to balance climate goals with a just transition for workers and coal-dependent regions. The commission proposed ending coal-fired power by 2038, supported by an estimated 69 billion to 93 billion euros in measures, including a 40 billion euro investment in affected regions. While praised for its multi-stakeholder approach and clear mandate, the plan faced criticism from NGOs for lacking ambition and providing excessive compensation to power plant operators.

The authors examine the experiences of villagers near the Garzweiler mine in the Rhineland, where lignite extraction continues to displace communities. They argue that the resettlement process is characterized by procedural injustice, as German federal mining law prioritizes resource extraction over residents' interests. The document highlights the failure of the 'joint resettlement' model to address non-material losses, such as the loss of 'Heimat' (homeland) and the erosion of social structures. It further links these local struggles to Germany's broader failure to accelerate its energy transition (Energiewende), noting that the country remains Europe's largest carbon emitter. The text describes the emergence of activist movements like Alle Dörfer Bleiben and Ende Gelände as responses to political inaction and the perceived entanglement between the government and the mining industry.

The report analyzes Germany's coal transition, contrasting the historical phase-out of hard coal with the more abrupt decline of lignite in East Germany. It presents two future scenarios: an NDC-based pathway and a 2C-compatible pathway, the latter requiring a more rapid shutdown of coal capacities, potentially by 2025-2040. The authors argue that while technically and economically feasible, a successful transition requires a combination of strong carbon pricing, national policy instruments like emissions performance standards, and comprehensive structural support for affected mining regions to ensure social justice.

The document assesses the progress of Germany's Energiewende, noting that while renewable energy shares have grown, coal still provided 42% of power production in 2015. It highlights the economic tension between the 'big four' utilities and decentralized renewables, the social and political challenges of phasing out hard coal and lignite, and the influence of industry unions in blocking a proposed climate levy on power plants in favor of a capacity reserve.