Eon has ruled out extending the life of its nuclear plant in Germany, even as Europe’s biggest economy prepares to ration its energy supplies and wean itself off Russian hydrocarbons.
“There is no nuclear future in Germany, period,” said chief executive Leo Birnbaum. “It’s too emotional. There will be no change in legislation and opinion.
Eon, which is Germany’s largest energy company, operates one of the country’s three remaining nuclear sites near Munich. The Isar 2 plant is expected to be decommissioned by the end of the year as part of the country’s long-standing shutdown of nuclear power generation put in place after Japan’s Fukushima disaster in 2011.
Russia’s invasion of Ukraine in February initially seemed to cause Berlin to rethink, with Green Economy Minister Robert Habeck saying he would not stand in the way of any decision to keep nuclear power plants in operation longer.
But that option was quickly ruled out, a move Birnbaum said Eon was happy to accept. While Isar 2 could “technically” remain operational beyond this year, “the judgment that has really been made is that we have a gas emergency and what little relief we could get from the side electricity isn’t really a game-changer,” he mentioned.
“There was a very serious discussion with the government,” he added. “They made a decent compromise decision, which we can understand, and so the story for us is over.”
The German government has moved quickly to secure alternative energy supplies as part of its long-term goal of reducing its dependence on Russian fuel. Habeck recently signed agreements with Qatar for the supply of natural gas and with the United Arab Emirates for green hydrogen.
Berlin activated last week the first stage of an emergency plan which, in the event of a gas shortage, would eventually lead to the reduction of gas supplies to large companies.
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However Eon, which buys its energy on the wholesale market and has no direct contracts with Russian suppliers, has joined German industry in warning against a boycott of Russian gas, on which Germany depends. for more than half of its annual consumption.
Such a move would disrupt supply chains and disrupt economic activity “on a scale that I think is significantly more problematic than Covid,” Birnbaum said.
Even if small and medium-sized enterprises, which constitute the bulk of Eon’s corporate clients, were not excluded in such a scenario, the impact on large groups such as the chemical giant BASF would have an effect “dangerous” on the rest of the market. The German economy, he added.
The chief executive also revealed that Eon’s domestic customers have so far not overwhelmingly opposed rising energy prices.
“I believe there is acceptance because we have now seen price increases in the market and we have seen little reaction from customers,” he said.
“The change following price increases has been extremely small,” he added. “It is understood that it is inevitable to conclude that if prices in the wholesale market increase fourfold or tenfold, then prices must increase. So people understand that. »