Germany should introduce a tax of 2 euro cent/kWh on fuel rods for nuclear power generation to re-establish the balance between different generation sources, according to a Green party proposal published by Suddeutsche Zeitung.
Citing a paper from the opposition party's energy expert Michael Schafer, the newspaper said the suggested tax would create annual income of Eur2 billion, increase costs for nuclear generation and with that possibly enforce competition.
The suggestion is based on the trade with emission rights: emitting units receive a certain, limited, amount of emission allowances for free, which in effect caps the time they are allowed to generate electricity at competitive prices. When their free rights run out, the operators have to buy rights on the market.
This makes generation from lignite, hard coal and gas units more expensive than nuclear production. However, generators add the additional charges not only to fossil generation but also to nuclear fueling--resulting in billions of euros in windfall profits.
A tax on nuclear power would increase cost for nuclear generation, reduce the profits of the operators while not resulting in additional cost for consumers, said the Green party specialist.
Platts, 9 January 2008