The German cabinet has agreed to grant compensation of up to EUR1 billion (USD1.17 billion) to the utilities forced to shut down their nuclear power plants by the Energiewende, or energy transition, that the government of Chancellor Angela Merkel introduced in response to the Fukushima Daiichi nuclear power plant accident in Japan in March 2011. At that time, Germany was obtaining around a quarter of its electricity from 17 nuclear reactors operated by EnBW, EOn, RWE and Vattenfall.
The cabinet’s approval of a draft law at a regular meeting in Berlin follows a ruling two years ago by the Federal Constitutional Court in Karlsruhe that the 2011 decision to withdraw all of Germany’s nuclear power plants by the end of 2022 violated some property rights, enabling the possibility of compensation for the utilities affected.
The draft law envisages compensation for RWE and Vattenfall for losses incurred as a result of Energiewende. A specific figure could only be calculated in 2023, the cabinet said, but the German Environment Ministry (BMU) has said payments for the two utilities would not exceed a low single-digit-billion-euro amount and would more likely be in the high three-digit-million-euro range.
Vattenfall, a Swedish state-owned utility, took its case for compensation to the International Center for Settlement of Investment Disputes (ICSID) in Washington in 2012, which has yet to reach a conclusion.
In a BMU statement, Federal Environment Minister Svenja Schulze said the bill passed by the cabinet ensures that the accelerated phaseout of nuclear power in Germany will continued and each nuclear power plant will retain its current statutory cut-off date of 31 December 2022.
The BMU added that the bill enables the utilities to “now demand adequate financial compensation for so-called frustrated investments they made in nuclear power plants between 28 October 2010 and 16 March 2011, with legitimate expectations of the extension of their lifetime”.
In August 2011, the 13th amendment of the Nuclear Power Act came into effect, which underlined the political will to phase out nuclear power in Germany. As a result, eight of the 17 nuclear power units were closed down immediately, and the remaining nine plants will be phased-out by the end of 2022. The eight were EnBW’s Phillipsburg 1 and Neckarwestheim 1; EOn’s Isar 1 and Unterweser; RWE’s Biblis A and B and Vattenfall’s Brunsbüttel and Krümmel.