Energy giant pulls plug on nuclear power

German power giant RWE will build no more nuclear power stations - not only in Germany, where nuclear power is to be phased out by 2022 - but anywhere in the world, the company announced on Monday.

Energy giant pulls plug on nuclear power
Photo: DPA

RWE “will not build any nuclear power plants abroad,” a company spokeswoman said, confirming a corresponding report in the Süddeutsche Zeitung daily.

At the end of March, RWE and its bigger rival E.ON decided they would pull out of their British nuclear power joint venture, Horizon Nuclear Power, the spokeswoman pointed out.

The Süddeutsche Zeitung newspaper said the management of Germany’s second biggest energy company held a secret meeting in an exclusive hotel in Istanbul on Friday and Saturday to discuss the major strategy change.

Peter Terium, RWE’s incoming CEO, who is to take over the company in July, told the company’s 200 most senior managers that he was planning a major overhaul of the company, the paper said.

The new plan is to pull out of the nuclear power business completely, and invest heavily in solar, in Germany and elsewhere, the paper said.

The news is a significant change of course for a company previously considered one of the most vehement defenders of nuclear power. RWE made a statement in March announcing that Germany’s transition from nuclear to renewable energy, announced last year, had cost it a third of its net profits.

Last week, German power suppliers also said they were suing the German government for €15 billion in lost income.

The Süddeutsche Zeitung said RWE had decided that the financial risks of building new nuclear power stations in those countries where the political will remained in favour, were too great. Huge delays in such construction projects in France and Finland have apparently convinced the company that nuclear power is not worth the financial risk.

Recent international ratings agency assessments have also threatened to downgrade nuclear power as an investment option if further nuclear safety risks are revealed, the paper said, citing unnamed company sources. This could do huge financial damage to RWE, a company currently working to pay off large debts.

Incoming CEO Terium also announced Monday that RWE could face large job cuts in the mid- to long-term. “RWE will also have to make some tough decisions,” he warned, saying the company faces major restructuring. “In three years time, the company will not have the same structures we do now.”

The Local/AFP/bk

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Could the Norwegian government introduce a cap on energy prices? 

Due to soaring prices, the Norwegian government is mulling over several solutions, including a potential price cap for electricity and limiting energy exports abroad. 

Could the Norwegian government introduce a cap on energy prices? 

High energy exports in the last 12 months, low filling levels in Norwegian reservoirs and an uncertain energy situation around Europe have led to soaring electricity prices in southern Norway. 

Last year the government introduced a scheme whereby it covers 80 percent of consumers’ energy bills where the price rose above 70 øre/kWh. The portion of the bill under 70 øre is paid in full by households. The portion the government covers will increase to 90 percent in October. 

Critics have argued that the current scheme still leaves households struggling with their bills. As a result, Norway’s government has said it is mulling its options to curb energy bills.

Norway primarily depends on hydroelectric dams to help it meet its energy needs. Still, reservoirs in southern Norway have been at the lowest level for ten years, public broadcaster NRK reports. 

Low reservoir filling over the past year has conceded with record exports with higher prices on the continent, making sending power abroad an enticing proposition.

Recently, exports have fallen significantly, and the government is considering introducing a limit to reduce the possibility of energy rationing being introduced this winter. 

“Restrictions on the export of electricity to Europe may be one of the measures that is needed,” Elisabeth Sæther, state secretary at the Ministry of Oil and Energy, told NRK. 

Earlier this week, Prime Minister Jonas Gahr Støre ruled out completely shutting off exports to the continent. 

“It is a dangerous thought and will not serve us well. It could give us more expensive power and lack of power in given situations. We will hardly be able to import power when we need it without contributing to other countries when they need it. There is a reciprocity in this,” he told the newspaper Aftenposten earlier in the week. 

Sæther also told NRK that the government was weighing up putting a maximum price on energy but warned that it could have unforeseen consequences. 

“We are afraid that a maximum price means that more water is drawn into the reservoirs, which we need for the winter. It is a serious situation. We must prevent ourselves from getting into a situation where we lack enough power this winter,” she told the broadcaster. 

At the end of May, the state-owned Statnett announced that the supply situation in Norway might be under strain – in some scenarios – all the way up to and through the winter, especially if Southern Norway experiences drier than usual weather in the second part of the year.