German utility E.ON said Friday it plans to retire its 1.3 GW Grafenrheinfeld nuclear reactor in May 2015, seven months ahead of the planned shutdown under Germany's nuclear phase-out law.
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The company has already notified the federal grid regulator BNetzA and transmission system operator TenneT of the intended shutdown, it said in a statement.
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 brevity of Grafenrheinfeld's remaining operating lifetime makes an early shutdown unavoidable in the interests of E.ON's shareholders, it said.
SECURITY OF SUPPLY
Should the regulator BNetzA judge the power plant necessary for security of supply, it may order its continued operation as a system-critical plant until the end of next year.
The costs for the continued operation could than be added to the grid fees paid by all consumers.
According to media reports last Friday, the early decommissioning of the plant may lead to a temporary shortage of electricity in Bavaria.
"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.
"There is no decision made in our house regarding an earlier than planned closure of the Grafenrheinfeld nuclear power plant," E.ON's generation unit spokesman Markus Nitschke told Platts last Friday, in response to the report. "However, we continuously consider the economic viability of our power plants especially in the light of the low market prices. And here the nuclear fuel tax is an extreme burden," the spokesman said in an email.
German wholesale power prices for delivery in 2015 have fallen below Eur34/MWh this week, the lowest level for year-ahead power in over nine years, Platts data shows.
The reactor was set to be refueled for the last time during its next annual maintenance break, scheduled to start June 13, 2015, according to a note on E.ON's transparency website 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.
NUCLEAR PHASE-OUT TIMETABLE IN FOCUS The decision follows comments earlier this month by Peter Ramsauer, the new head of the economy and energy committee in the German parliament (Bundestag), calling into question the planned nuclear exit timetable.
"If you want to cut power prices you must return to nuclear energy," Ramsauer, a former minister in Merkel's second cabinet, said in an interview with German weekly Der Spiegel published March 15.
Ramsauer, from the Bavarian sister party of Chancellor Merkel's ruling CDU/CSU, added that no politician would want this at the moment. "But I do not rule out that we will come in a few years to the conclusion that developments are getting out of hand and that we can't afford the 'Energiewende' [energy transition into a renewable energy age]."
Germany decided in the aftermath of the Fukushima nuclear crisis in 2011 to reverse a planned extension of nuclear run-times and to return to an earlier nuclear phase-out plan.
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 would remove almost 8,000 MW of nuclear capacity within the space of just over 12 months.