German nuclear power debate resurfaces over Russian gas threat

Germany should extend the lifetime of its nuclear plants to avoid an "extreme scenario" in which a Russian gas stop could wipe 12 percent off the economy, a government advisor said Thursday.

The nuclear power plant in Gundremmingen, Swabia, stopped operating on December 31st 2021 as part of Germany's nuclear phase-out.
The nuclear power plant in Gundremmingen, Swabia, stopped operating on December 31st 2021 as part of Germany's nuclear phase-out. Photo: picture alliance/dpa | Stefan Puchner

Prolonging the operational lifetime of Germany’s remaining reactors could “create some breathing space”, Veronika Grimm, a member of the government’s council of economic advisors, told the Funke media group.

Germany turned its back on nuclear energy following the Fukushima nuclear disaster in Japan in 2011, with its last three plants set to go offline at the end of the year.

But the debate over prolonging the life of nuclear in Germany has been reopened amid fears Russia could cut off gas supplies as retaliation against the West over its backing for Ukraine following Moscow’s invasion.

In an “extreme scenario”, the German economy could shrink by 12 percent if Russia turned the taps off, Grimm said.

More conservative estimates put the impact between “minus 0.5 percent and minus six percent” depending on decisions made about saving gas over the summer, she said.

READ ALSO: How much energy does Germany need to get through winter?

Like many of its neighbours, Germany is highly reliant on Russian energy imports to meet its needs.

Europe’s largest economy this week decided to reactivate mothballed coal-fired power plants in response to reduced gas deliveries from Russia via the Nord Stream pipeline.

But extending the life of nuclear plants beyond the end of the year was “currently not an option”, not least for “safety reasons”, a spokesman for the economy ministry said at a regular press conference on Wednesday.

Keeping the plants open “will not work”, Chancellor Olaf Scholz told the Münchener Merkur paper on Tuesday.

Finance Minister Christian Lindner of the liberal FDP party denied that there was a row within the three-way coalition with Scholz’s Social Democrats and the ecology Greens.

But he added that he was “not satisfied that we are extending climate-damaging coal but not even considering the possibility of nuclear energy”.

READ ALSO: Why Germany is discussing whether people should ‘freeze by law’

The conservative state premier of Bavaria, Markus Söder, has also pushed for an extension, saying this week the move was “certainly” possible.

But the boss of German energy company RWE, the operator of one of the remaining reactors in the fleet, told the Die Welt daily it was “too late”.

Security issues as well as the limited availability of fuel rods created hurdles to keep the plants going beyond the end of the year, he said.

READ ALSO: Why Germany’s nuclear exit is posing tough questions about its energy future

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Germany prepares energy bailout law as gas prices soar

The German cabinet on Tuesday approved plans to quickly prop up struggling energy companies as a looming Russian cut-off and soaring gas prices heap pressure on the sector.

Germany prepares energy bailout law as gas prices soar

Germany would “not allow system effects” to ripple through the gas market, where the failure of one company could lead others to go under as well, Economy Minister Robert Habeck told reporters.

The emergency legislation will “facilitate” stabilisation measures for energy companies, including the possibility of the government becoming a shareholder, the ministry said.

German energy company Uniper, one of the biggest importers of Russian gas, entered into talks with Berlin over a possible rescue plan last week.

A 60-percent reduction in gas supplies via the Nord Stream pipeline from Russia in mid-June forced Uniper to pay higher prices for alternative supplies on the spot market.

Unable to pass the cost on, the gas squeeze left Uniper with “significant financial burdens”.

READ ALSO: ‘Scarce commodity’: Germany raises gas alert level as Russia reduces supplies

Bailout options under discussion included extending further credit lines from the public lender KfW or an equity investment in Uniper, the group said.

Officials estimate a rescue package for the struggling energy group could cost around €9 billion, according to Bloomberg News.

Germany has criticised Gazprom’s “political” decision to limit supplies, which the Russian energy company blames on a delayed repairs.

Following the move, Berlin raised the alert level under its emergency gas plan, bringing it a step closer to rationing the fuel.

The government has mandated for its gas storage facilities to be 90 percent full by the beginning of December.

In June, Berlin also bailed out Russian energy giant Gazprom’s former subsidiary in Germany with between nine and 10 billion euros worth of loans after it had been placed under state control.

Securing Energy for Europe, as the company was renamed, is a network operator, and indirectly controls Germany’s largest but largely empty gas storage facility in the northwestern town of Rehden.