SHARE
COPY LINK

POLITICS

Germany to close nuclear reactors despite energy crisis

Germany will shut down three nuclear power plants on Friday even as Europe faces one of its worst ever energy crises, following Angela Merkel's timetable for phasing out atomic energy.

The Gundremmingen nuclear power plant, southern Germany
The Gundremmingen nuclear power plant in southern Germany. Germany will shut down three nuclear power plants amid one of the worst European energy crises in history. LENNART PREISS / AFP

With energy prices already on the rise and tensions higher than ever between Europe and key gas supplier Russia, the closure of the plants in Brokdorf, Grohnde and Gundremmingen could well tighten the squeeze.

The move will halve remaining nuclear capacity in Germany and reduce energy output by around four gigawatts — equivalent to the power produced by 1,000 wind turbines.

READ ALSO: Why Germany’s nuclear exit is posing tough questions about its energy future

Protests over the Fukushima nuclear disaster in 2011 prompted former chancellor Merkel to set the wheels in motion for abandoning nuclear power just over 10 years ago.

Germany is planning to completely wind down atomic energy by the end of 2022, when it will shut its final three plants in Neckarwestheim, Essenbach and Emsland.

But with energy prices soaring across Europe, the timing of the plans coming to fruition could hardly be worse.

Europe’s reference gas price, Dutch TTF, hit 187.78 euros per megawatt hour in December — 10 times higher than at the start of the year — and electricity prices are also soaring.

The spike has been fuelled by geopolitical tensions with Russia, which supplies one third of Europe’s gas.

Western countries accuse Russia of limiting gas deliveries to put pressure on Europe amid tensions over the Ukraine conflict.

Moscow also wants to push through the controversial Nord Stream 2 pipeline, set to ship still more Russian gas to Germany.

READ ALSO: German regulator suspends Nord Stream 2 approval process

Price hikes
The end of nuclear power in Germany will likely push prices up even further, according to Sebastian Herold, a professor of energy policy at the Darmstadt University of Applied Sciences.

“In the long term, the hope is that an increase in renewable energy will balance things out, but this will not be the case in the short term,” he told AFP.

Manual widget for ML (class=”ml-manual-widget-container”)

Until Germany can really ramp up renewables, it will remain dependent on fossil fuels to plug the gap left by the nuclear exit.

“This will make Germany more dependent on natural gas overall, at least in the short term, and thus also a little more dependent on Russia,” Herold said.

The transition may also take longer than Germany would like, with progress on renewables slowed in recent years by opposition to energy infrastructure projects.

The proportion of energy generated by renewables is expected to fall in 2021 for the first time since 1997 — to 42 percent, compared with 45.3 percent in 2020.

As well as driving up prices, the nuclear plant closures will also remove a key source of low-carbon energy in a country that is already struggling to meet ambitious climate goals.

The new coalition government under Social Democrat Olaf Scholz has pledged to bring forward Germany’s planned coal exit to 2030 and wants Germany to generate 80 percent of its electricity from renewables by the same year.

Second thoughts?
But Robert Habeck, the co-leader of the Green party and head of a newly created super-ministry for the economy and climate, admitted this week that Germany is already on course to miss its climate targets for 2022 and probably also 2023.

Other EU countries, including France, are continuing to push nuclear energy and campaigning for it to be included on the EU’s list of sustainable energy sources eligible for investment.

Even in Germany, public opinion towards nuclear seems to be softening.

In a recent YouGov survey for the Welt am Sonntag newspaper, around 50 percent of Germans said they were in favour of reversing the planned nuclear shutdown due to the recent sharp rise in energy prices.

Monika Schnitzer, a member of the German Council of Economic Experts, told the Rheinische Post newspaper that it would make sense “economically and ecologically” to delay the shutdown.

But the government is sticking to Merkel’s plan, with Habeck this week defending the nuclear shutdown.

Any politician calling for the reintroduction of nuclear energy “would also have to say, I would like to have the nuclear waste in my constituency,” he said. “As soon as someone says that, I will revisit the issue.”

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.
For members

ENERGY

Is now a good time to switch energy providers in Germany?

The market prices for electricity and gas in Germany are cheaper now than they have been for a long time, leading some consumer advisors to recommend customers shop around for lower tariffs.

Is now a good time to switch energy providers in Germany?

Why are energy prices going down? 

Last year, energy prices in Germany rose to record heights following the Russian invasion of Ukraine. But now, partly thanks to a milder winter than initially feared, market prices for gas and electricity have taken a downturn.

READ ALSO: ‘Over half’ of Germans heating homes less or not at all

So far, however, most consumers are yet to benefit from the lower prices, as they are still being supplied with the electricity and gas that suppliers bought at higher prices last year.

This is particularly the case with the so-called basic suppliers (Grundversorger) – the companies that supply most customers in a region (such as Vattenfall or GASAG) – as they tend to buy electricity and gas on a long-term basis, in some cases years in advance. 

Last year, this meant that the basic suppliers could still offer the lower prices of the past, but gradually, they have had to raise their tariffs. 

“As a result, they now have some catching up to do and are passing on the high procurement prices to customers,” Christina Wallraf, an energy expert at the consumer advice centre in North Rhine-Westphalia explained.

Who is offering low prices?

Gas and electricity prices from so-called alternative suppliers – energy companies other than the basic suppliers – are now falling across the board.

This is because such suppliers have a short-term procurement strategy, which means they can “pass on favourable market prices more quickly than the basic suppliers buy for longer periods”, Hans Weinreuter from the Rhineland-Palatinate consumer centre explained.

For new customers – energy shoppers who join a new provider – prices are considerably cheaper than they were a few months ago. 

A green plug in front of an electricity bill. Photo: picture alliance / Jens Kalaene/dpa-Zentralbild/dpa | Jens Kalaene

The current average price of a kilowatt hour of gas for new customers is currently around 14.3 cents – 64 percent less than the average at the beginning of September last year when it reached a peak of around 40 cents. 

Electricity prices for new customers have also dropped by around 24 percent since mid-October, when a kilowatt hour of electricity for new customers still cost an average of 56 cents, whereas the current price is 42.7 cents.

For basic suppliers, the prices have moved in the opposite direction. Since the beginning of September, basic gas supply prices rose on average from 12.7 to 17.7 cents per kWh, while the price of basic electricity supply rose by 27 percent – from 36.8 to 46.6 cents per kWh since mid-October.

When does it make sense to switch?

Numerous consumer advisors recommend those who are currently stuck in very expensive tariffs to look around for alternatives.

“That’s where a look at possible alternatives makes sense,” says Hans Weinreuter from the Rhineland-Palatinate Consumer Center.

Udo Sieverding, an energy expert at the consumer advice centre in North Rhine-Westphalia, told the Berliner Taggespiegel: “Anyone who wants to switch now has a good chance of finding a cheaper tariff.”

He added that there is no rush, however, and said that he considers “the risk of prices at discounters going up again in the next few months to be low”.

A man turns up the thermostat on a radiator.

A man turns up the thermostat on a radiator. Photo: picture alliance/dpa | Hauke-Christian Dittrich

However, Julia Schröder, an energy law expert at the Lower Saxony consumer advice centre, recommended that consumers should not take the decision to switch suppliers lightly, as this usually means being bound to a new provider for one or two years when “nobody can foresee” how prices will develop over the next 24 months. A change would therefore be worth it only if it resulted in substantial savings, she advised. 

However, Ingbert Liebing, CEO of the Association of Municipal Enterprises (VKU), recently criticised the appeals of experts to consumers to switch from basic suppliers to discounters with cheap tariffs.

READ ALSO: Energy prices could double long-term in Germany, utilities companies warn

“It was foreseeable that now again soldiers of fortune would enter the energy market and think they can make a quick deal, at the expense of the municipal utilities and basic suppliers,” he said of the lower tariffs currently on offer by alternative providers. 

He warned against cheap tariffs that lure customers in with low prices for a short period of time and then raise them again in a matter of months. 

Can I switch from a basic to a discount provider?

Theoretically, switching from a basic to an alternative energy provider should be straightforward. Unlike those in contracts with special tariffs, customers of basic suppliers generally have the legal right to cancel at any time with two weeks’ notice and look for another supplier.

READ ALSO: EXPLAINED: How to change electricity and gas providers in Germany

Those who are not with a basic supplier should look at their documents and check for how long their current gas supply contract is still valid. If there is a supplier with more favourable conditions, it may be worthwhile to terminate the contract. 

Oncoming price brakes

Another thing to bear in mind when considering whether to switch energy suppliers is the oncoming price brakes for gas and electricity. 

READ ALSO: 7 reasons to be optimistic about life in Germany in 2023

In the case of electricity, 80 percent of consumption will be capped at 40 cents per kilowatt hour from March, backdated to January. The same applies to gas: from March, backdated to January, natural gas customers will receive a state-guaranteed price of twelve cents per kilowatt hour for 80 percent of their previous annual consumption.

A person holds a wallet with cash.

A person holds a wallet with cash. Photo: picture alliance/dpa | Lino Mirgeler

Despite the price brakes, it can still be worth switching if the contractually agreed energy price with your current supplier is over 40 cents per kilowatt hour for electricity and over twelve cents per kilowatt hour for gas.

That’s largely because the price brakes for electricity and gas are currently limited to just one year.

“If the price brakes are not extended, every kilowatt hour consumed will cost the regular contract price again next year. This is another reason why it will be important for consumers to choose the cheapest possible tariff this year,” said Thorsten Storck from Verivox.

SHOW COMMENTS