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ENERGY

Energy giant pulls plug on nuclear power

German power giant RWE will build no more nuclear power stations - not only in Germany, where nuclear power is to be phased out by 2022 - but anywhere in the world, the company announced on Monday.

Energy giant pulls plug on nuclear power
Photo: DPA

RWE “will not build any nuclear power plants abroad,” a company spokeswoman said, confirming a corresponding report in the Süddeutsche Zeitung daily.

At the end of March, RWE and its bigger rival E.ON decided they would pull out of their British nuclear power joint venture, Horizon Nuclear Power, the spokeswoman pointed out.

The Süddeutsche Zeitung newspaper said the management of Germany’s second biggest energy company held a secret meeting in an exclusive hotel in Istanbul on Friday and Saturday to discuss the major strategy change.

Peter Terium, RWE’s incoming CEO, who is to take over the company in July, told the company’s 200 most senior managers that he was planning a major overhaul of the company, the paper said.

The new plan is to pull out of the nuclear power business completely, and invest heavily in solar, in Germany and elsewhere, the paper said.

The news is a significant change of course for a company previously considered one of the most vehement defenders of nuclear power. RWE made a statement in March announcing that Germany’s transition from nuclear to renewable energy, announced last year, had cost it a third of its net profits.

Last week, German power suppliers also said they were suing the German government for €15 billion in lost income.

The Süddeutsche Zeitung said RWE had decided that the financial risks of building new nuclear power stations in those countries where the political will remained in favour, were too great. Huge delays in such construction projects in France and Finland have apparently convinced the company that nuclear power is not worth the financial risk.

Recent international ratings agency assessments have also threatened to downgrade nuclear power as an investment option if further nuclear safety risks are revealed, the paper said, citing unnamed company sources. This could do huge financial damage to RWE, a company currently working to pay off large debts.

Incoming CEO Terium also announced Monday that RWE could face large job cuts in the mid- to long-term. “RWE will also have to make some tough decisions,” he warned, saying the company faces major restructuring. “In three years time, the company will not have the same structures we do now.”

The Local/AFP/bk

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ENERGY

German government announces fresh relief package for high energy costs

With Russia's invasion in Ukraine exacerbating high energy and petrol prices, Germany is set to introduce a second relief package to limit the impact on consumers.

German government announces fresh relief package for high energy costs

The additional package of measures was announced by Economy and Climate Protection Minister Robert Habeck (Greens) on Sunday.

Speaking to DPA, Habeck said the wave of price increases throughout the energy sector were becoming increasingly difficult for households to bear.

“Extremely high heating costs, extremely high electricity prices, and extremely high fuel prices are putting a strain on households, and the lower the income, the more so,” he said. “The German government will therefore launch another relief package.”

The costs of heating and electricity have hit record highs in the past few months due to post-pandemic supply issues. 

This dramatic rise in prices has already prompted the government to introduce a range of measures to ease the burden on households, including abolishing the Renewable Energy Act (EEG) levy earlier than planned, offering grants to low-income households and increasing the commuter allowance. 

READ ALSO: EXPLAINED: What Germany’s relief package against rising prices means for you

But since Russia invaded neighbouring Ukraine on February 24th, the attack has been driving up energy prices further, Habeck explained.

He added that fears of supply shortages and speculation on the market were currently making the situation worse. 

How will the package work?

When defining the new relief measures, the Economics Ministry will use three criteria, Habeck revealed. 

Firstly, the measures must span all areas of the energy market, including heating costs, electricity and mobility. 

Heating is the area where households are under the most pressure. The ministry estimates that the gas bill for an average family in an unrenovated one-family house will rise by about €2,000 this year. 

Secondly, the package should include measures to help save energy, such as reducing car emissions or replacing gas heating systems.

Thirdly, market-based incentives should be used to ensure that people who use less energy also have lower costs. 

“The government will now put together the entire package quickly and constructively in a working process,” said Habeck.

Fuel subsidy

The three-point plan outlined by the Green Party politician are not the only relief proposals being considered by the government.

According to reports in German daily Bild, Finance Minister Christian Lindner (FPD) is allegedly considering introducing a state fuel subsidy for car drivers.

The amount of the subsidy – which hasn’t yet been defined – would be deducted from a driver’s bill when paying at the petrol station. 

The operator of the petrol station would then have to submit the receipts to the tax authorities later in order to claim the money back. 

Since the start of the war in Ukraine, fuel prices have risen dramatically in Germany: diesel has gone up by around 66 cents per litre, while a litre of E10 has gone up by around 45 cents.

READ ALSO: EXPLAINED: The everyday products getting more expensive in Germany

As well as support for consumers, the government is currently working on a credit assistance programme to assist German companies that have been hit hard by the EU sanctions against Russia.

As reported by Bild on Saturday, bridging aid is also being discussed for companies that can no longer manage the sharp rise in raw material prices.

In addition, an extension of the shorter working hours (Kurzarbeit) scheme beyond June 30th is allegedly being examined, as well as a further increase in the commuter allowance.

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