EPH
Czech company EPH is one of Europe’s largest polluters. In recent years, it has found a new way of drawing money from state budgets. EPH owns the German coal companies LEAG and MIBRAG. According to German law, EPH will now receive substantial government compensations for the “early” closure of LEAG’s and MIBRAG’s coal assets. EPH’s subsidiary LEAG will receive €1.75 billion of taxpayers’ money for shutting down its coal plants in 2038. At the same time, LEAG is currently in the process of expanding its coal mine Nochten. The mine is grazing down the neighboring village of Mühlrose. 200 people are losing their homes for the mine.
Taking a look at GCEL, it still seems as if EPH's coal business has drastically decreased. Its coal production has dropped by three quarters in just one year. The company produces only 25% of its power from coal now, compared to 53% the year before. EPH even wants to divest from its coal assets by 2025. But its coal business hasn’t disappeared. EPH simply created a sister company to which it is transferring all its coal assets: EP Energy Transition. EP Energy Transition operates independently from EPH but shares the same owner: the Czech billionaire Daniel Ketínský.
According to mining law in Germany, companies have to rehabilitate coal mines once they close them down. It takes billions of dollars to shut down mines and restore the environment. By transferring its coal assets to EP Energy Transition, EPH is getting rid of this responsibility. Eventually, EPH might completely get off the hook financially.
This is the perfect PR stunt for EPH: It appears environmentally friendly to the public. At the same time, it receives massive compensation payments for shutting down coal mines early. And EPH doesn’t have to pay for the proper closure of these mines because it doesn’t own them anymore. Ultimately, EPH is demonstrating how to set up a decarbonization strategy without actually decarbonizing.