Germany: Nuclear Back Pay and the Return of Coal

Here in the United States, the government has imposed a tax on nuclear facilities to pay for a used fuel repository. But there isn’t one and the courts have made it clear that until one is at least on the drawing boards, no more waste fee. That’s supposed to take effect in May.

In Germany, the government has also run afoul of the courts:

he Hamburg Financial Court has ordered authorities in Germany to refund German utilities more than EUR2.2bn (USD3bn) in nuclear fuel taxes. The refund is to be paid to five energy companies, including E.ON and RWE.

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Courts in Hamburg and Munich have both opined that they believe the tax to be unconstitutional, and have requested instruction from Germany's Constitutional Court and the European Court of Justice.

That last part can lead us to believe that this would have happened even if the nuclear facilities continued to operate. But it does seem like garish exploitation to keep the fee, like getting hospital bills after the patient has expired. It doesn’t smell right.

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So that’s one thing. Here’s another:

What’s a beleaguered utility to do when forced by the government to close its profitable nuclear power plants?

It turns to lignite, a cheap, soft, muddy-brown colored form of sedimentary rock that spews more greenhouse gases than any other fossil fuel.

Lignite! That makes my head shake unbidden, as in, No you can’t be doing that.

You can guess how this turns out.

The result: RWE now generates 52 percent of its power in Germany from lignite, up from 45 percent in 2011. And RWE isn’t alone. Utilities all over Germany have ramped up coal use as the nation has watched the mix of coal-generated electricity rise to 45 percent last year, the highest level since 2007.

The story goes on to say that RWE and its colleagues can’t count on lignite continuing to be plausible, thus mandating a change to renewable energy, like it or not. You sometimes see complaints about American legislators choosing energy winners and losers. Without wading too deeply into that issue, this is what that is really like.

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A little expansion on these points from CNN:

For German consumers who ultimately foot the bill, the tab for renewable subsidies comes to $32 billion this year, and soaring electricity bills are hitting households and businesses hard. The Energiewende [switch to renewable energy] also requires construction of a costly and extensive new infrastructure of high-voltage transmission lines to carry power from northern wind farms to the industrial south. The spreading visual blight has sparked local outbreaks of Nimbyism.

“Germany’s electricity prices are already the highest in Europe, 40 to 50 percent higher than the EU average and twice as much as in the U.S.,” notes Jurgen Kronig, a prominent Energiewende critic who writes for the German weekly Die Zeit.

Nimbyism certainly didn’t do nuclear energy any favors in Germany. Pretty soon they’ll be complaining that their neighbors’ candles are too bright.