Released June 13, 2017 | GALWAY, IRELAND
en
Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Germany's highest court has ruled that the government's controversial nuclear fuel tax was illegal and that affected energy companies will be refunded the billions of euros they were forced to pay.
Following the decision by the Constitutional Court that the tax was "unconstitutional and void," Germany's Ministry of Finance confirmed that repayments will be made in the "coming weeks" to Energie Baden-Württemberg AG (EnBW) (FWB:EBK) (Karlsruhe, Germany), RWE AG (FWB:RWE) (Essen, Germany), E.ON SE (FWB:EOAN) (Düsseldorf) and Sweden's Vattenfall AB (Stockholm). The amount is expected to be 6.3 billion euros ($7 billion) in repaid taxes and up to 1.5 billion euros ($1.7 billion) in interest payments. E.ON said it expects a tax refund of $3.2 billion with an additional $504.6 million in interest payments.
The nuclear fuel rod tax was introduced at the start of 2011 as part of a deal that would allow the German government to collect billions of euros in tax from the energy companies in return for extending the lives of Germany's older nuclear plants. However, just months later, after the Fukushima nuclear accident, the German government took the surprise decision to shut all 17 reactors before 2022. The tax, however, remained in place and has been the subject of many court battles. For additional information, see May 30, 2011, article - Germany Votes to Dump Nuclear Power.
Industrial Info reported on how the tide was turning in favour of the energy companies last December when a German High Court ruled that the government must pay compensation to power companies that were affected by its decision to shut down all of the country's nuclear power plants in 2011. For additional information, see December 13, 2016, article - German Nuclear Power Companies to Get Compensation.
Commenting on the outcome last week, RWE stated: "The German Constitutional Court informed RWE in writing that the nuclear fuel tax levied until 31 December 2016 was not compliant with the provisions of German constitutional law and is retrospectively void. RWE had made approximately 1.7 billion euro ($1.9 billion) in nuclear fuel tax payments since 2011. RWE will analyse the reasons for the decision. The company had already stated in its annual report that any refunds would be recorded in the non-operating result. Therefore, adjusted EBITDA and adjusted net income will not be affected. No decision has been made on how these funds will be used."
In related news, Germany's nuclear companies agreed last year to pay 23.6 billion euro ($26 billion) into a fund that will deal with the country's nuclear waste. For additional information, see October 25, 2016, article - Germany Agrees $26 Billion Nuclear Waste Fund.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Our European headquarters are located in Galway, Ireland. Follow IIR Europe on: Facebook - Twitter - LinkedIn For more information on our European coverage send inquiries to info@industrialinfo.eu or visit us online at Industrial Info Europe.
Following the decision by the Constitutional Court that the tax was "unconstitutional and void," Germany's Ministry of Finance confirmed that repayments will be made in the "coming weeks" to Energie Baden-Württemberg AG (EnBW) (FWB:EBK) (Karlsruhe, Germany), RWE AG (FWB:RWE) (Essen, Germany), E.ON SE (FWB:EOAN) (Düsseldorf) and Sweden's Vattenfall AB (Stockholm). The amount is expected to be 6.3 billion euros ($7 billion) in repaid taxes and up to 1.5 billion euros ($1.7 billion) in interest payments. E.ON said it expects a tax refund of $3.2 billion with an additional $504.6 million in interest payments.
The nuclear fuel rod tax was introduced at the start of 2011 as part of a deal that would allow the German government to collect billions of euros in tax from the energy companies in return for extending the lives of Germany's older nuclear plants. However, just months later, after the Fukushima nuclear accident, the German government took the surprise decision to shut all 17 reactors before 2022. The tax, however, remained in place and has been the subject of many court battles. For additional information, see May 30, 2011, article - Germany Votes to Dump Nuclear Power.
Industrial Info reported on how the tide was turning in favour of the energy companies last December when a German High Court ruled that the government must pay compensation to power companies that were affected by its decision to shut down all of the country's nuclear power plants in 2011. For additional information, see December 13, 2016, article - German Nuclear Power Companies to Get Compensation.
Commenting on the outcome last week, RWE stated: "The German Constitutional Court informed RWE in writing that the nuclear fuel tax levied until 31 December 2016 was not compliant with the provisions of German constitutional law and is retrospectively void. RWE had made approximately 1.7 billion euro ($1.9 billion) in nuclear fuel tax payments since 2011. RWE will analyse the reasons for the decision. The company had already stated in its annual report that any refunds would be recorded in the non-operating result. Therefore, adjusted EBITDA and adjusted net income will not be affected. No decision has been made on how these funds will be used."
In related news, Germany's nuclear companies agreed last year to pay 23.6 billion euro ($26 billion) into a fund that will deal with the country's nuclear waste. For additional information, see October 25, 2016, article - Germany Agrees $26 Billion Nuclear Waste Fund.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Our European headquarters are located in Galway, Ireland. Follow IIR Europe on: Facebook - Twitter - LinkedIn For more information on our European coverage send inquiries to info@industrialinfo.eu or visit us online at Industrial Info Europe.
