Work to accelerate grid expansion started earlier this year with legislation authorizing pilot tests of high-voltage underground power cables. Merkel’s new plan, which she hopes the parliament will approve this summer, simplifies the permitting process for transmission and provides compensation to affected communities.
Opposition from Germany’s nuclear power companies could set back the government’s plans, however. The companies may petition the courts to block collection of a new nuclear-fuel tax that the government expected would provide 2.3 billion Euros per year to underwrite new wind farms. Even if the tax survives legal challenge, the eight reactors already shut down will trim revenues by about one billion Euros, according to Germany’s finance ministry. Courts could also order compensation for the companies that own the silenced reactors, further reducing the government’s freedom of action to support renewables.
E.ON AG, Europe’s top power generator and operator of six German reactors, said in a statement Tuesday that it considers the nuclear fuel tax “unlawful” and that it would seek compensation for stranded investments in its reactors: “E.ON accepts the will of the political majority to secure an early phase-out of nuclear energy. At the same time the company expects to receive due compensation for the financial damages associated with these decisions, which is expected to amount to billions of Euros.”
Andreas Kraemer, director of the Berlin- and Washington-based Ecologic Institute, is hopeful that Germany will take greater advantage of energy conservation options and rely on more distributed forms of renewable power generation that consume waste and biomass. However, Germany could also end up relying more heavily on coal-fired power, which provided 43 percent of electrical generation in 2010.
Germany may also import more energy from France, as long as public opinion there enables nuclear reactors in France to continue churning out surplus power.