Prospects for the west German coal mining industry

Ensuring a politically reliable and sufficient energy supply is a priority of West Germany's economic policy. In 1980, primary energy consumption by the German economy amounted to 390,000,000 tons of coal equivalent (tce). Domestic hard coal makes an important contribution to the following economically significant markets: West Germany's electricity generation and the West Germany steel industry. In 1980, the German hard coal output amounted to about 88,000,000 tons. To replace oil and natural gas as well as meet future energy demand, coal and nuclear energy will have to be used as primary sources of energy. (1) Further energy conservation, expansion of district heating systems and industrial coal use, wider application of heat pumps, construction of more coal-fired power power plants, and participation in foreign coal projects is required. (2) Early commissioning of nuclear power stations and construction of conventional coal refining plants. (3) There must be an increase in domestic hard coal output. Investments are the key factor in the future development of West Germany's hard coal mining industry. In order to maintain the current level of production and prepare for expansion, investments of up to $1,610,000,000 per year will be required. Although the competitive position of domestic hard coalmore » has improved considerably in recent years, mining companies are not yet able to bear the necessary capital costs by themselves. Energy investments have long lead times and are capital intensive. Return of investment takes time and thus capital risk is great. This risk has to be made acceptable. As long as investments, including an appropriate return of interest for capital outlay, do not pay in the market, the coal industry will need further support from government energy policy in order to fulfill its duty as an energy supplier.« less