The price to phase out nuclear power

Bold political decision

On March 15th, 2011, Germany halted operations at eight of its oldest nuclear reactors. Two months later Chancellor Angela Merkel announced the end of the country’s nuclear program: All of the country’s reactors will shut down by 2022. As a direct consequence, the utility company Mainova supplying the City of Frankfurt am Main will raise its kWh tariff by 9% on March 1st, 2012.

Globally, many welcome the decision to definitively phase out nuclear energy. And Germany is well prepared. German’s companies are amongst the world leader in renewable energies (in particular wind, waste-to-energy, and to a less extent photovoltaic). Relation with Gazprom is excellent (just ask former German’s Chancellor Gerhard Schröder). Siemens and others are ready to build more gas and coal fired power plants.

I am not worried about the sector ability to massively build new plants of any type, or about any energy shortage. It is highly unlikely to see any load shedding in Germany for the next decades. The issue is elsewhere.

Bold, that is all well and good, but it is also expensive

It’s not a mystery. Phasing ou nuclear power plant will turn to be a quite big financial drain. There is no miracle. Offshore wind farm investments are enormous. Not only the wind turbines have to be built, but also the transmission network necessary to transfer the power from windy areas to big load centers.

The price of natural gas will certainly continue to rise (just ask former German’s Chancellor Gerhard Schröder).

Big investments added to higher operation and maintenance costs is not a light recipe for our energy bills. They wilt get fatter.

The bill? No, thanks

Who will pay for it? You and me of course! End consumers, at the end of the commercial chain, are always there to cover costs increases. The impact is often hidden, in taxes or in eroded quality for instance. But in my case, it is quite straightforward and visible. 9% increase.

In a typical formal letter nobody likes to receive in his mailbox, Mainova gently explains “network use costs cover the maintenance of the existing network and to finance further network developments to enable, among other things, power transmission from wind farm to the consumers.” They continue, “we do whatever we can to maintain the price as low as possible”. Hum? Then further empty promises. And finally, bang! 9% increase. From 0.23 to 0.25 EUR/kWh. 0,02 EUR/kWh only for network development related to nuclear phase out. I can’t wait for the day they will ask us to pay for nuclear power plant decommissioning.

Electricity in Germany was already high compared to other countries. Now it beats the world record. Next time you come in Germany, you will think twice before turning on the light.

Welcome in the new world free of nuclear power. It’s just a matter of bold politic… and of ordinary people forced to pay for it.

The bill? Yes, please

To be honest, I do agree with this strategy. Less nuclear, more renewable energies is a good move. I just wanted to warn you it has a cost. And we have to pay for it. I am personally ready to do so. Do you?