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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland) -- German energy giant E.ON AG (OTC:EONGY) (Dusseldorf, Germany) wants 8 billion ($10 billion) in damages from the German government to compensate it for the country's shock exit from the nuclear energy market last year.
The company, along with Energie Baden-Württemberg AG (EnBW) (Karlsruhe, Germany) and RWE AG (OTC:RWEOY) (Essen, Germany), have taken legal action against the government's decision to shut down all 17 of its nuclear reactors in the coming decade, a decision that was prompted by the nuclear disaster at Japan's Fukushima Dai-ichi plant last March. For additional information, see May 30, 2011, article - Germany Votes to Dump Nuclear Power.
E.ON and other energy companies had not long before secured life extensions for their nuclear plants from the government when it dramatically decided to ditch nuclear power altogether. This resulted in the immediate shut down of eight older nuclear power plants, followed by a shut down schedule for the remaining plants by 2022.
Despite the shut-down, the government has still been collecting its controversial 'nuclear tax' which it brought in as part of its original decision to allow the nuclear plants to extend their operating lives.
E.ON is hoping for a favourable decision from the country's constitutional court, which will seek input from the federal court, parliament and over 60 other institutions. A final decision, however, could take years.
"An amount of 8 billion is about right," Christian Drepper, a spokesman for E.ON, confirmed to media.
Last September, the Hamburg Finance Court questioned the constitutional validity of the federal government's nuclear tax and ordered that one unnamed energy company -- believed to be E.ON -- to suspend any further payments and be repaid almost 100 million it paid in tax earlier in 2011. For additional information, see September 27, 2011, article - Germany's Nuclear Tax Branded 'Unconstitutional'.
The financial impact from the nuclear exit decision on companies including E.ON and RWE has been significant. In November, both companies posted mixed financial results for the first nine months and blamed the government's abandonment of nuclear power for losses amounting to billions of euros. For additional information, see November 16, 2011, article - Nuclear Exit Hits German Energy Giants.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
The company, along with Energie Baden-Württemberg AG (EnBW) (Karlsruhe, Germany) and RWE AG (OTC:RWEOY) (Essen, Germany), have taken legal action against the government's decision to shut down all 17 of its nuclear reactors in the coming decade, a decision that was prompted by the nuclear disaster at Japan's Fukushima Dai-ichi plant last March. For additional information, see May 30, 2011, article - Germany Votes to Dump Nuclear Power.
E.ON and other energy companies had not long before secured life extensions for their nuclear plants from the government when it dramatically decided to ditch nuclear power altogether. This resulted in the immediate shut down of eight older nuclear power plants, followed by a shut down schedule for the remaining plants by 2022.
Despite the shut-down, the government has still been collecting its controversial 'nuclear tax' which it brought in as part of its original decision to allow the nuclear plants to extend their operating lives.
E.ON is hoping for a favourable decision from the country's constitutional court, which will seek input from the federal court, parliament and over 60 other institutions. A final decision, however, could take years.
"An amount of 8 billion is about right," Christian Drepper, a spokesman for E.ON, confirmed to media.
Last September, the Hamburg Finance Court questioned the constitutional validity of the federal government's nuclear tax and ordered that one unnamed energy company -- believed to be E.ON -- to suspend any further payments and be repaid almost 100 million it paid in tax earlier in 2011. For additional information, see September 27, 2011, article - Germany's Nuclear Tax Branded 'Unconstitutional'.
The financial impact from the nuclear exit decision on companies including E.ON and RWE has been significant. In November, both companies posted mixed financial results for the first nine months and blamed the government's abandonment of nuclear power for losses amounting to billions of euros. For additional information, see November 16, 2011, article - Nuclear Exit Hits German Energy Giants.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
