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Germany's €2.6 billion sale of STEAG may delay company's coal phase-out

October 26, 2023

Key Takeaways:

STEAG’s 2023 sustainability commitment to phase out its German coal-fired power generation by mid-2026, well ahead of the national target, has been thrown into doubt by its sale to a private equity investor.

The buyer has given no explicit commitment to uphold STEAG’s coal phase-out plan, which could see the utility burning coal beyond 2030.

IEEFA calls for a reassessment of STEAG’s sale process, or at the minimum a more responsible sale to a buyer who is committed to implementing STEAG's coal exit plan.

26 October 2023 (IEEFA) | The announced sale of STEAG to a private equity investor puts the German state-owned power utility at risk of reneging on its new sustainability commitments and extending its hard coal phase-out by up to eight years.

Research from the Institute for Energy Economics and Financial Analysis (IEEFA) warns that instead of complying with STEAG’s target to phase out coal at its German power plants by mid-2026, the new owner will maximise the utility’s coal fleet lifetime until each plant has been compulsorily decommissioned, which may not happen until 2034.

With 4.1 gigawatts (GW) of coal generation, STEAG is the second-most polluting power utility in Europe, out of 25 analysed. Under current circumstances, it will still have 1.2 GW of coal power operating beyond 2025 and 0.75 GW beyond 2030.

Owned by KSBG KG, a consortium of six German municipal utilities, STEAG announced last year it would be sold. In August 2023, just three months after the 2026 coal phase-out target was published, Madrid-based Asterion Industrial Partners said it had agreed to acquire the utility for about €2.6 billion.

In its press release, Asterion stated that it supports the German government’s plans to phase out coal, but it made no mention of following STEAG’s commitment to phase out coal by mid-2026. 

“As Germany races to deploy renewables at record pace, STEAG risks becoming a climate laggard that continues burning coal for the financial benefit of its new private owner,” said Jonathan Bruegel, co-author of the report and an IEEFA power sector analyst.

“While STEAG’s current municipal utility owners want to wash their hands of its polluting assets, they should be aware that the current sale could leave the company’s sustainability commitments in shreds.”

The report, which updates a previous IEEFA study (published on 1 June 2023), calls for STEAG’s sale to be postponed until all its coal plants have a binding latest decommissioning date, which would allow KSBG to secure the utility’s coal exit—instead of handing over responsibility to a private owner focused on maximising profits.

An alternative would be to sell the company conditional to a firm, public commitment from the buyer to implement STEAG’s coal exit commitments.


Read the report



The Institute for Energy Economics and Financial Analysis (IEEFA) examines issues related to energy markets, trends and policies. The Institute’s mission is to accelerate the transition to a diverse, sustainable and profitable energy economy.

Press contact

Sofia Russi | [email protected]

Arjun Flora

Arjun Flora is Director, Europe, at IEEFA. Arjun is responsible for leading and building the Europe team, partnering with funders, campaigners and investors to maximize IEEFA’s impact.

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Jonathan Bruegel

Jonathan Bruegel is a power sector analyst for IEEFA’s Europe team. Before joining IEEFA, Jonathan worked more than 20 years in the energy sector and became an expert on power markets worldwide working for several power generation utilities.

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