🍎 🍕 Less apples, more pizza 🤔 Have you seen Buffett’s portfolio recently?Explore for Free

Explainer-Could Germany keep its nuclear plants running?

Published 2022-08-18, 10:43 a/m
© Reuters. A general view shows the nuclear power plant Isar 2 by the river Isar in Eschenbach near Landshut, Germany, August 17, 2022. REUTERS/Christian Mang/File Photo
NG
-

FRANKFURT (Reuters) - German utilities have said they may operate the country's three remaining nuclear reactors beyond their scheduled year-end closure date, but it is up to Berlin to get the ball rolling.

Power grid operators are currently stress testing the transmission system to assess the risks of an escalation in the the Russian gas supply crisis as winter approaches, with the results expected shortly.

The outcome could prompt the government to extend the life of the reactors as it attempts to power the economy and ward off a recession seen as increasingly likely if faltering Russian gas exports stop entirely.

Former Chancellor Angela Merkel initiated legislation to halt the use of nuclear power after the Fukushima nuclear disaster of 2011 with a majority of voters in favour, but attitudes are shifting amid fears of fuel shortages.[POWER/DE]

A reversal or postponement of the exit plan would mean utilities E.ON, RWE and EnBW having to re-arrange decommissioning schedules and staffing provisions, while legal, safety and liability issues would have to be worked out with Berlin.

Here are answers to a few urgent questions:

WHY THE NEED?

Russia has cut gas flows through the major Nord Stream 1 pipeline to Germany to just 20% of capacity. Moscow says Western sanctions over the invasion of Ukraine are hindering equipment repairs, while Europe says this a pretext to reduce flows and use gas as a political weapon, an argument Russia rejects.

Germany, Russia's single biggest gas buyer, cut use of the fuel by 15% during January-June. Although it is exploring other sources of supplies, it remains dependent on Russia.

Energy regulator the Bundesnetzagentur says tight supply means there will be problems keeping consumers warm and industry functioning, while surging gas prices increase the risk of recession.

Gas-fired plants account for 15% of power generation, some of which could be replaced by nuclear as well as increased use of imported and domestic coal. Using less gas to heat Germany's 41 million households would free up more for industry.

E.ON, RWE and EnBW operate 4,300 megawatts (MW) of nuclear power capacity via their respective Isar 2, Emsland and Neckarwestheim 2 reactors.

Along with three other reactors which closed at the end of last year, nuclear recently generated 12% of Germany's electricity.

Germany also has solar and wind options and is developing liquefied natural gas (LNG) terminals.

WHAT DO THE OPERATORS SAY?

E.ON's Chief Executive Leonhard Birnbaum says it can extend the lifespan of Isar 2 by a few months into 2023 without having to procure fresh fuel rods.

RWE CEO Markus Krebber also says the plants could theoretically run in the first weeks of next year but beyond that would require new fuel elements, or even the revitalisation of capacity shut in 2021 - decisions the government would need to make.

EnBW's CFO takes a similar line.

WHAT IS THE SYMBOLISM BEHIND GERMAN NUCLEAR?

© Reuters. A general view shows the nuclear power plant Isar 2 by the river Isar in Eschenbach near Landshut, Germany, August 17, 2022. REUTERS/Christian Mang/File Photo

The Green Party, now part of the coalition government, traces its origins to the environmentalist movement of the 1970s, which cited security risks and the unresolved question of nuclear waste. It would have to make a U-turn.

Restating the usefulness of nuclear power would vindicate critics of Merkel's move and populist voices.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.