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posted on 14 June 2015

German Nuclear Tax: 'Kernbrennstoffsteuegesetz'

Written by , GEI Associate

In today's technologically developed world, where new forms of energy are arising frequently, and the need for efficient and cheap energy is sought, nuclear energy has become a controversial source of energy from an economic, scientific, social and ethical perspective.

In 2010, Germany attempted and succeeded in implemented a nuclear levy, 'Kernbrennstoffsteuegesetz' which was a 6 year decision up until the end of 2016. Since the 2010 taxation adoption, each gram of fissile nuclear fuel loaded into a German reactor has had a levy of €145. The tax is expected to bring in an annual revenue of approx €2.3 billion. This law was initiated in order to tax the usage of nuclear fuel for electricity, because the argument is that nuclear fuel shouldn't be a singular exemption from taxation for energy. The following is a table of German nuclear power units (hat tip World Nuclear Association).

Plant Type MWe (net) Commercial operation Operator Provisionally scheduled
shut-down 2001
2010 agreed shut-down March 2011 shutdown
& May 2011 closure plan
Biblis A PWR 1167 2/1975 RWE 2008 2016 shutdown
Neckarwestheim 1 PWR 785 12/1976 EnBW 2009 2017 shutdown
Brunsbüttel BWR 771 2/1977 Vattenfall 2009 2018 shutdown
Biblis B PWR 1240 1/1977 RWE 2011 2018 shutdown
Isar 1 BWR 878 3/1979 E.ON 2011 2019 shutdown
Unterweser PWR 1345 9/1979 E.ON 2012 2020 shutdown
Phillipsburg 1 BWR 890 3/1980 EnBW 2012 2026 shutdown
Krümmel BWR 1260 3/1984 Vattenfall 2016 2030 shutdown
Total shut down (8) 8336
Grafenrheinfeld PWR 1275 6/1982 E.ON 2014 2028 May 2015
Gundremmingen B BWR 1284 4/1984 RWE 2016 2030 end 2017
Gundremmingen C BWR 1288 1/1985 RWE 2016 2030 2021
Grohnde PWR 1360 2/1985 E.ON 2017 2031 2021
Phillipsburg 2 PWR 1392 4/1985 EnBW 2018 2032 2019
Brokdorf PWR 1370 12/1986 E.ON 2019 2033 2021
Isar 2 PWR 1400 4/1988 E.ON 2020 2034 2022
Emsland PWR 1329 6/1988 RWE 2021 2035 2022
Neckarwestheim 2 PWR 1305 4/1989 EnBW 2022 2036 2022
Total operating (9) 12,003
Total (17) 20,339 MWe

NB: The eight shut-down reactors are not yet defueled, nor decommissioned and written off by their owners.

Critics of this have said that this is a setback biased towards energy groups in Germany, such as RWE and E.on, whose shares fell dramatically last week. Various companies stated that thousands of jobs were cut due to subsidized clean energy sources. As a result, they felt it would cause them to lose billions of Euros in revenue. Another argument that was given to the EU courts was that this tax was illegal according the the Union's legalities regarding taxation and energy laws.

Last week the European Court of Justice came forth and concluded that these taxations are indeed compatible with European law, and in addition, the tax on nuclear fuel does not constitute state aid. There is still a debate going on however within the Federal Constitutional Court of Karlsruhe whether or not imposing such a tax is legal. However, such a decision is only to be made by the end of this year. It seems as though this ruling will prove to be a final one, and the taxation will remain as implemented and won't constitute any legal consideration of any level of state aid. Thus, it seems to be unlikely that such a levy will be proven to be unlawful within the next year.

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