A German court on April 14 reaffirmed that a nuclear fuel rod tax is unconstitutional and has ordered federal tax authorities to reimburse €2.2. billion ($3.04 billion) paid by five nuclear-owning utilities until compatibility with European and German law is established.
The Financial Court of Hamburg had held in January 2013 that the federal nuclear fuel rod tax, which became effective in January 2011, was unconstitutional, saying the tax was enacted simply to “to siphon off the profits of the nuclear plant operators.”
Introduced as part of a deal in late 2010 by the federal legislature in return for life-extensions of nuclear power plants in Germany, the nuclear fuel tax is triggered when a nuclear reactor is equipped with a fuel element and a self-sustaining chain reaction is initiated. The amount of tax depends on the nuclear fuel used, but it carries a levy of €145 ($196) per gram of nuclear fuel (U-233, U-235, and Plu-239, and Plu-241) used for the commercial generation of electricity.
The Financial Court referred the case separately to the federal Constitutional Court—which alone has the jurisdiction to rule on the unconstitutionality of a law—and to the European Court of Justice for a preliminary ruling to clarify compatibility with European law.
But on April 14, the Financial Court of Hamburg granted preliminary relief as it acted on new petitions for interim legal protection from the plaintiffs, which means the five utilities will be spared from paying the nuclear fuel rod tax until the Constitutional Court and the European Court of Justice hand down decisions. Those decisions are expected for within the next 18 months.
E.ON said in a statement that the decision means it could see refunds of about €1.7 billion ($2.35 billion). RWE’s refund is about €400 million ($553 million).
“The decision reaffirms the serious doubts about the constitutionality of the nuclear fuel tax and its compatibility with EU law and is therefore expressly welcomed by E.ON,” E.ON said in a statement on April 14.
—Sonal Patel, associate editor (@POWERmagazine, @sonalcpatel)