€2.2 billion owed to German nuclear utilities

Germany should immediately refund some €2.2 billion in nuclear fuel taxes collected from EOn and RWE, pending final decisions on the tax from either the Federal Constitutional Court or the European Court of Justice.

The latest ruling in the court battle over nuclear fuel taxes in Germany came yesterday from the Hamburg Tax Court, underlining successive decisions since power plant operators were required to pay €145 ($200) per gram of uranium or plutonium loaded into power reactors. The tax is intended to take about half of the profit from the nuclear power plants.

That tax arrangement had been agreed between utilities and the government in 2010 as an amendment to the 2002 Atomic Energy Act that would allow longer operating lives for German reactors. But the government reneged on the deal in reaction to the 2011 Fukushima accident in Japan by taking away the longer lives and forcing closures of older units - all while keeping the tax. Power companies were quick to take the matter to court.

In yesterday's ruling, the Hamburg Tax Court agreed with the utilities that they should be relieved from paying the tax, and should be refunded some €2.2 billion ($3.0 billion) until the tax's legality is finally decided. Two courts have the power to end the matter once and for all: The Federal Constitutional Court may decide that the tax is unconstitutional due to being aimed at reducing profit rather than reducing consumption; or the European Court of Justice (ECJ) could rule the tax as being against EU legislation because it applies to an input of electricity generation, not the output product, as taxes across the 28 nation bloc should uniformly do. A ruling from either of the courts would settle the matter, although final judgements are not expected for several months at least.

EOn is owed about €1.7 billion, and RWE about €500 million. Before the tax and Germany's concerted attack on nuclear power in the wake of Fukushima, the companies had been among Europe's most powerful utilities, seeking to invest in many of the European Union's increasingly integrated and competitive power markets. It is expected that customs offices will appeal the latest ruling to delay any repayment, while an EOn statement said the expected sum would not be recorded in its accounts immediately.

In parallel with contesting the tax, RWE is also claiming damages from the losses incurred as a result of the forced closure of its Biblis nuclear power plant in 2011. The actions of the state of Hesse were ruled to be unlawful in this regard by the German Supreme Court in January. Another nuclear utility, EnBW, is 45% owned by the Green-controlled state of Baden-Württembergand not contesting its damages. Vattenfall of Sweden is fighting the shutdowns of two German reactors in which it has stakes via international arbitration.

Researched and written
by World Nuclear News