German utilities reject nuclear phase-out funding proposal

Germany‘s Commission on the Review of Funding for the Phase-Out of Nuclear Energy (Kommission zur àƒÅ“berpràƒ¼fung der Finanzierung des Kernenergieausstiegs, or KFK) released its recommendations this week.

It proposes that the four power firms operating nuclear plants in Germany ” E.ON, RWE, EnBW and Vattenfall ” undertake full financial responsibility for shutting down and decommissioning their plants. The government would then establish a fund to pay for waste storage. In total, €23.34bn would be paid by the utilities, a sum that includes their own estimates plus an additional 35 per cent risk premium designed to cover any extra costs.

All four power firms have largely endorsed the proposal, but all have objected to the addition of the risk premium.

RWE, E.ON and EnBW, in a joint statement posted on each firm’s website, said the proposal would “overburden energy companies’ capacities”, while Vattenfall said “the so-called risk premium which the Commission requests on top of the amount of provisions already in the books of the companies is disproportionate to the economic strength of the affected utilities”. à‚ à‚ 

“In talks with the KFK, the companies have been willing to accept a risk premium to enable a consensus,” the joint statement said. “In order to achieve such an agreement, the companies have transparently presented their financials and offered to go as far as their utmost economic limits would permit.

“However, these limits have been trespassed by the amount of a risk premium suggested by the KFK.”

The joint statement said the utilities “cannot accept the suggestions” from the KFK as they stand, but stressed that “the energy companies are still interested in achieving a consensual solution regarding the organization and financing of the nuclear phase out in Germany”. Vattenfall also said the proposals are, “in principle, a feasible way to organize and finance the nuclear power phase-out”.

Stefan Dohler, senior vice-president for markets at Vattenfall, said, “We take our responsibility for this process but can’t offer financial solutions which are contrary to the given commercial and legal framework.”

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