Zeitschrift für Energiewirtschaft

The end of lignite mining in Germany is approaching. Thus, in this paper, we analyze how well the four lignite mining regions in Germany (Lausitzer, Mitteldeutsches, Rheinisches und Helmstedter Revier) are prepared for this structural transformation. Our study suggests that shutting-down lignite mining would substantially affect lignite region economies. Given that settlement structure, transport connections as well as public infrastructure differ by lignite region, counteracting the expected negative economic consequences will be harder for some regions than for others. In recent years, urban areas have benefited from higher economic growth driven especially by the service sector. Rural areas in contrast have not performed equally well. We expect this trend to continue and therefore, consider the economic prospects of rural areas, in particular the Lausitzer Revier, as less favorable. Our study also shows that the two East German lignite mining regions are still characterized by substantially lower per capita incomes and productivity levels. Although, we expect that East-West convergence will continue, low industrialization rates, a small service sector and a lack of innovation will hamper the catching-up process. Thus, we recommend that policy acts to support the economic transformation especially in the East German lignite mining regions.