Delaying Germany’s Nuclear Phaseout Is Easier Said Than Done

(Bloomberg) -- Two of Germany's largest energy companies said they are open to delaying a highly anticipated nuclear phaseout. But keeping the plants open may be easier said than done.

EON SE and EnBW Energie Baden-Wuerttemberg AG said they're willing to discuss a possible extension of operations. While keeping the plants open past the 2022 closing deadline is technically possible, companies have no contracts to buy nuclear fuel after that and the government may encounter a backlash from voters and environmental groups alike.

Germany has long-planned to exit atomic energy, but the invasion of Ukraine has prompted calls for Europe to wean itself off Russian natural gas. Former Chancellor Angela Merkel briefly tried to delay the plan, but then reversed course due to the policy's broad support. Now Economy Minister Robert Habeck says he's “not ideologically opposed” to it.

“It is understandable that the prevailing conditions for energy policy are being reassessed,” EON said in a statement. “In this extraordinary situation, we are willing to enter talks about which technical, organizational, and regulatory boundary conditions would be required for prolonged operations.”

European countries are all taking steps to ensure they have enough energy as the war rages in Ukraine, and sanctions fuel concern Russia may retaliate by curbing commodity exports. Germany also pledged support for renewables and new LNG terminals, and said it could delay it's coal exit. Italy could reopen some shuttered coal plants and is also considering importing more gas from the U.S., Azerbaijan, Algeria, Tunisia and Libya.

Bringing back some of the reactors that have already closed would be very difficult, but it could be possible to continue operating plants that haven't yet shut. EON said it has been preparing for the phaseout for years, but would be open to a delay if explicitly asked by the German government. EnBW said it supports the exit, but is prepared to examine all measures to guarantee security of supply and to advise the German government if asked to do so.

RWE AG said that keeping its Emsland plant open after 2022 would would require overcoming a number of “significant obstacles,” both technically and legally.

“Restarting the already retired plants would be extremely hard -- for workforce and technical reasons,” said Hanns Koenig, an analyst at Aurora Energy Research. “What could potentially be done, but would still be very hard, is extend the lifetimes of the remaining 4 gigawatts of plants.”

Europe Is Losing Nuclear Power Just When It Really Needs Energy

Fuel Access

One of the biggest obstacles is access to fuel. It often takes about 18 months to secure new supply, according to Nicolas Wendler, a spokesman for the German nuclear industry group Kerntechnik Deutschland.

PreussenElektra GmbH, a subsidiary of EON, said it won't have the fresh fuel needed to keep operating. It also won't have the highly-trained staff needed to keep its Isar 2 reactor running beyond its scheduled closing date.

To be sure, nuclear operators could still conserve fuel over the summer to use in the more energy-intensive winter months, said Rod Adams, a partner at Nucleation Capital. In the meantime, they could buy more to keep running the following year. But it would require robust support from the German government.

“It would take a significant and dramatic reversal by the leadership,” Adams said. “There's nothing that can't be overcome. It just might take a war to do it.”

Delaying the nuclear phaseout could help reduce reliance on gas and avoid burning more coal, the dirtiest fossil fuel. Still, Germany is yet to make any decision about atomic power despite announcing other measures including a plan to boost renewable sources of energy.

“The preparations for shutting down are at such an advanced stage that the atomic power plants could only be operated for longer under the highest security concerns and possibly with fuel supply that hasn't yet been secured,” Habeck said. “I wouldn't oppose it ideologically -- but the preliminary examination has shown that it doesn't help us.”