Under a deal made this weekend between energy companies and the government of Chancellor Angela Merkel, the life of Germany’s 17 nuclear power plants, located in five of the country’s 16 federal states, will be extended by up to 15 years. The decision has spurred opposition from the country’s local utilities and renewable industry.

The compromise essentially calls for Germany’s energy giants to pay €15 billion to fund research into renewable energy if the government will set aside a 2000 agreement made by the Schröder government and keep nuclear plants open for another 12 years beyond 2021.

Merkel, a former environment minister, was widely quoted as calling the compromise a “reasonable technical solution.” She said that the renewable sector was not capable of filling the energy gap left if nuclear plants were shut down by the mandated deadline. The government had commissioned a report to settle the matter, but results were reportedly inconclusive.

Utilities investing heavily in renewables and combined heat and power plants said that the decision would be bad for investment, reported Reuters. As a Bloomberg New Energy Finance analyst explained to Bloomberg, the levy—as much as €3 billion a year—on nuclear plant operators to support renewable energy could mean utilities would cut investments in sectors like offshore wind.

Düsseldorf-based E.ON said in a statement on Monday that it welcomed, “in principle,” the agreement. The company said it would push on with the expansion of renewable energy in Germany and around the world, however.

"With this decision, the German government has made it clear, that nuclear energy will continue to be needed for some time as one of the main pillars of our energy policy," said CEO Johannes Teyssen. “This compromise would allow nuclear energy to make an important contribution to affordability, security of supply and climate protection on the way to tomorrow’s energy supply.”

The company said the compromise meant considerable burdens for E.ON in the form of taxes and charges. “The concrete implications still needed to be examined for each plant. Arithmetically, the government decision means that the operating lives of E.ON’s nuclear power plants Isar 1 and Unterweser will be extended by 8 years each, and those of Grafenrheinfeld, Grohnde, Brokdorf and Isar 2 by 14 years each.”

The different extension periods for old and new plants were a political decision which the operators had to accept, Teyssen said. There was no technical justification for this decision because regardless of their age, all plants met the same stringent safety standards. On the whole, the average operating life extension of 12 years was a considerable challenge because it was too short a period to create a bridge to future energy supplies.

“What is now required are special additional efforts on all sides to build a stable bridge into Germany’s energy future,” he said.

Sources: POWERnews, E.ON, Reuters