Siemens Walks Away from Nuclear Power

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--German industrial giant Siemens AG (NYSE:SI) Munich, Germany) has become the first major engineering company to abandon the nuclear power sector.

Siemens' Chief Executive Peter Löscher revealed that the company will no longer be involved in the construction or financing of nuclear power plants. He explained that its decision was influenced by the disastrous events at the Fukushima nuclear plant in Japan in March and the subsequent public and political backlash against nuclear power.

"We will no longer be involved in overall managing, building or financing of nuclear plants," he told German press. "This chapter is closed for us."

The decision comes on the back of the German government's surprise U-turn on nuclear power in May, when it reversed a decision to extend the lives of older nuclear plants and instead implemented a fast exit from the nuclear sector. The country aims to have all 17 of its reactors shut down before 2022. Siemens was heavily involved in the construction of all of those plants. For additional information, see May 30, 2011, article - Germany Votes to Dump Nuclear Power.

"[The decision is] an answer to the clear position of society and politics in Germany on exiting nuclear power," Löscher added.

Although the company said it will no longer make nuclear components, its steam turbines, which are used in nuclear, coal and gas-fired plants, will continue to be made available for nuclear projects.

The biggest casualty of Siemens' decision will be Russian state-owned nuclear energy company Rosatom (Moscow), with which Siemens signed a memorandum of understanding (MoU) to create a nuclear joint venture back in March 2009. The loss of Siemens as a partner is expected to weaken Rosatom's ability to compete with rival nuclear reactor manufacturers.

According to Siemens, the withdrawal from the nuclear sector will have no impact on the financial performance of its Siemens Energy division, its second-largest revenue generator. Last year, the renewable energy division was the strongest in terms of performance company-wide.

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