Merkel sets course to break the mold
In the world of policy reversals among the heads of major European nations, which occur rarely, a Teutonic tectonic shift occurred this week with one from German Chancellor Angela Merkel who described her country's decision to close its nuclear plants as "absolutely wrong." It is a political earthquake which will shake up German politics.
For her trouble Ms. Merkel will undoubtedly have to put on her political armor and fend off the arrows of outrage from the Green party and her other political opponents who have taken a strong line on shutting down Germany's nuclear power plants. She'll need allies and she's got one right next door.
What's even more interesting about this announcement is that Merkel made her remarks as a joint press conference with French President Nicolas Sarkozy in Straubing, Bavaria. Readers will recall that the French leader is also the world's most successful nuclear salesman having inked a major deal or two in the past year and with more prospects and deals coming up in the near term.
Readers will also recall that Sarkozy has an issue with Siemens, the German heavy machinery firm, which owns a one-third share of Areva. Sarkozy would like to sell shares of Areva on the market to raise funds to build the reactors he's selling, but not at the expense of loss of control of the state owned company. For its part the Germans aren't interested in seeing their share of the firm, read control, diluted by news shares owned by new stockholders.
Alstom, the French turbine maker, also wants a piece of Areva since Mr. Sarkozy is selling all those reactors which also, by the way, need turbines. Whether the German and French heavy machinery manufacturers would collide like two Sumo wrestlers remains to be seen.
Lastly, Areva is setting its sights on building a lot of reactors in the U.K. which right now has one of the world's most aggressive new build plans involving as many as 18 new plants.
What this has to do with Merkel is that if you are going to hitch your wagon to a star, Mr. Sarkozy is an excellent candidate, at least as far as new nuclear builds are concerned. His experience with nuclear energy can be a useful navigational beacon as Merkel sets sail on a new course.
Blunting Russia's natural gas gambits
There is another reason Germany may change its tune on nuclear energy. Like many other parts of Europe, Germany gets a lot of its natural gas from Russia. Mr. Putin has shown a predisposition to turn off the supply when the politics of his neighbors displease him. If Germany wants a degree of energy independence from the Russian bear nuclear is the way to go.
According to World Nuclear News, Merkel inherited the 'Nuclear Exit Law' written by the previous coalition government led by the Gerhard Schroeder's Social Democrats (SPD) and including the Green Party. Merkel has previously called for a "sensible course" on energy in Germany, in response to desires to stop using the coal-fired and nuclear power plants which together supply 73% of electricity.
Nuclear energy will play a significant role in the 2009 elections. Her opponents, including the influential Greens, are sticking to the phase-out decision. Germany will elect a new government around September 2009. Deutsche Welle speculated that Merkel's party link up with the liberal Free Democratic Party, which supports overturning the nuclear phase-out.
Swiss move ahead with plans for new plant
While the Germans were reconsidering their energy options the Swiss were moving ahead with their own plans for nuclear energy. According to World Nuclear News, Swiss energy company Atel has submitted an application for a new nuclear power plant to Switzerland’s Federal Office of Energy.
The Niederamt plant would be built alongside the Gösgen nuclear power plant, in which Atel owns a 40% stake, but would be independent of the existing plant. No reactor design is specified in the application, other than a "third generation light water reactor."
The application is based on both 1100 MWe and 1600 MWe capacities. According to Herbert Niklaus, Atel’s head of energy for Switzerland, the project will cost SFR6-7 billion ($6-7 billion).
WNN also reported that Switzerland is anticipating an energy shortfall of 25-30 billion kWh by 2035 - around half the country's current generation. The news service reported that Atel CEO Giovanni Leonardi (right) cited the anticipated shortfall and the strengths of nuclear power, especially in terms of energy security, economic efficiency and climate friendliness, as main reasons behind Atel's application.
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