- - Monday, September 19, 2011

BERLIN Germany’s recent retreat from nuclear power in the wake of Japan’s ongoing crisis already is causing legal and economic headaches.

On Monday, the Financial Court in Hamburg expressed doubts about the constitutionality of a new federal tax on nuclear fuel rods - a ruling hailed as a victory by nuclear power plant operators.

The court also approved a nuclear plant operator’s request to suspend collection of the tax and reimburse payments that already have been made.

A spokesman for energy supplier E.ON, which filed the first of several pending lawsuits against the tax, said the government had no legal basis to impose such a levy.

“It’s a first step. We will file suit over every plant [that has this tax liability],” company spokesman Mirko Kahre said of the court ruling.

The tax, which was implemented Jan. 1 on nuclear power plant operators, was expected to generate $2 billion to $2.75 billion in revenue annually.

However, Germany has bigger legal issues over its about-face on nuclear energy.

“The decision is a major blow for the government,” said Matthias Lang, a lawyer specializing in energy issues at Bird & Bird’s Dusseldorf offices. “But there is also a debate about the constitutionality of the decision to shut the plants down.”

German Chancellor Angela Merkel closed the country’s seven oldest nuclear reactors three days after a March 11 tsunami caused a meltdown in reactors in Japan. Eight of Germany’s 19 plants remain shut.

Mrs. Merkel also placed a three-month moratorium on a law that extended the life of the country’s nuclear program.

In May, the government announced that all of Germany’s nuclear plants would be phased out by 2022, a dramatic reversal of policy for a country that produces as much as 23 percent of its electricity via nuclear energy.

Constitutional scholars across Germany said the moratorium was unconstitutional on the grounds that only the legislature could make such a move, barring an imminent threat to the public.

Meanwhile, the announced phaseout of nuclear energy already has come at a cost to the industry and the government. It is also blamed for slowing economic growth in the second quarter of this year.

Engineering conglomerate Siemens announced Sunday that it is shuttering its nuclear-business division.

“The chapter for us is closed … . We will no longer be involved in managing the building or financing of nuclear plants,” a company spokesman told the German newsweekly Der Spiegel.

Siemens is not alone. Rising energy costs already are hurting heavy industry in this country noted for its manufacturing capacity. In August, chemical producer Bayer, which employs 35,000 people in Germany and has global sales of $48 billion, issued a warning that it is considering leaving Germany because of high energy prices.

Germany’s renewable-energy industry is expecting a windfall in the demise of nuclear energy.

However, for now at least, Germany’s lost energy production from nuclear power is being filled by an increased use of fossil fuels - a painful irony for a green-energy policy - and by increased imports of electricity from other European countries that use nuclear energy.

“Saying we can run an industrial society on renewable energy is dumbing-down the truth for people,” said Heinz Horeis, who writes on scientific issues for German publications.

“Since the shutdown, we have become a net importer of electricity, and there has been no real plan. I would like to know what is going to happen come winter.”


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