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Merkel embarks on energy trip

Aug. 18, 2010 at 4:56 PM   |   Comments

BERLIN, Aug. 18 (UPI) -- German Chancellor Angela Merkel on Wednesday embarked on an energy tour through Germany, shortly before her government will unveil its energy concept for the next decades.

Wind turbines, gas-fired power plants and nuclear reactors -- Merkel will see the entire energy portfolio during her energy trip through Germany. It comes roughly a month before the German government decides what the country's future energy mix should look like.

The German government's energy concept, to be unveiled by the end of September, will decide how long the 17 German nuclear reactors are to remain online and to what levels renewable energy sources should be pushed.

Once dubbed "eco-chancellor," Merkel's green reputation has taken a hit after she openly lobbied to extend the running times of Germany's most modern reactors. Nuclear power remains highly unpopular in Germany, despite the energy form's revival across Europe.

It's no accident, then, that Merkel's tour starts off rather green. On Wednesday she stopped in Carinerland, a town of 1,200 souls that aims to become energy independent by 2020. Already, 14 wind turbines, several solar panels and a biogas plant are producing power and heat in Carinerland.

On Thursday, Merkel will stop in Leipzig at the European Energy Exchange, where power, natural gas, CO2 emission allowances and coal are traded. The EEX determines the German wholesale power price, and Merkel's spokesman Steffen Seibert said the chancellor with her visit aims to underline the importance of functioning competition in the energy sector.

Germany's power sector for years was dominated by four large utilities -- Eon, RWE, EnBW and Vattenfall -- and only significant pressure from Berlin and the European Union has managed to increase competition.

The big four are now also trying hard to keep their nuclear reactors online -- and that's where the controversy enters her trip.

Merkel on Aug. 26 will visit a nuclear power plant in Lingen, where she will meet with the chief executive officers of Eon and RWE.

Because of energy security and climate-change concerns, Merkel's pro-business government generally agrees to keep nuclear in the mix, but it wants part of the utilities' additional income in return.

Berlin has suggested a tax on nuclear fuel used in reactors aimed at compensating for the costs of nuclear waste disposal, and it could hand Berlin an estimated $2.75 billion per year.

The utilities have resisted the tax and will likely fight it again on Aug. 26. The German press, meanwhile, has termed the meeting a "negotiation showdown."

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