E.ON’s nuclear plant closure threatens Bavarian energy security

E.ON (FWB: EOAN) is citing unprofitability as the prime motive for plans to shut down the 1.3 GW Grafenrheinfeld nuclear reactor in May 2015, seven months ahead of the planned shutdown under Germany's nuclear phase-out law.

The decision is expected to impact on Bavaria’s energy security, although the grid regulator may order the facility to remain open as a system-critical plant until the end of next year.
The company has already notified the federal grid regulator BNetzA and transmission system operator TenneT of the intended shutdown, it said in a statement.

Platts reports the company as saying that it said it took the decision because the plant is not profitable as continuing operation of nuclear power stations in Germany only makes economic sense if they can operate for a sufficient length of time without the burden of the nuclear-fuel tax, which expires in 2016.

The costs for the continued operation could than be added to the grid fees paid by all consumers.

"We need the capacity from Grafenrheinfeld 2015 for security of supply," Bavaria's prime minister Horst Seehofer was quoted as saying by Munich-based newspaper Sueddeutsche Zeitung last Friday.

Reports estimate that the nuclear fuel tax for the refueling of the plant would cost E.ON around Eur80 million ($110 million). The Grafenrheinfeld reactor will lose its operating license on December 31, 2015 under Germany's nuclear phase-out law.

After Grafenrheinfeld in 2015, two more reactors are set for decommissioning by the end of 2017 and 2019. The remaining six reactors are set to lose their operating licences by the end of 2021 and 2022 respectively, which would remove almost 8,000 MW of nuclear capacity within the space of just over a year.

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