RWE criticises Germany's plans for coal levy

German power giant RWE hit out Thursday at government plans to impose a levy on older fossil-fuelled power plants, warning of tens of thousands of job losses in the industry and soaring electricity prices.

In a bid to meet its goals of reducing carbon emissions by 40 percent by 2020, Economy and Energy Minister Sigmar Gabriel has proposed a climate fee on older coal-fired power plants.

But energy companies and unions are up in arms.

"If the undertaking by the economy and energy ministry is implemented as planned, it will lead to major structural upheavals in the lignite industry," RWE's chief executive Peter Terium told shareholders at the group's annual general meeting in Essen.

"These plans would lead, in the short term, to a disorganised, rushed exit from lignite-based electricity production. The consequences would be far-reaching."

An early abandoning of coal "would mean the loss of a secure, low-cost and subsidy-free source of energy, in and for Germany," Terium said.

It would have a tangible impact on security of supply, particularly as Germany has also committed to phasing out nuclear energy by 2022. And wholesale electricity prices would rise, increasing the cost burden for the whole of German industry.

"These plans also threaten tens of thousands of otherwise secure jobs that are either directly or indirectly connected with the lignite industry," Terium said.