Vattenfall ‘may gain’ from German nuclear move

Swedish energy giant Vattenfall may end up benefiting from a recent decision by Germany to ditch nuclear power, according to the company's CEO.

Vattenfall 'may gain' from German nuclear move
A Vattenfall nuclear power plant in Germany

While the German decision will be costly for Vattenfall initially, CEO Øystein Løseth believes the German state has a responsibility to help the company ease the financial fallout.

“We’re expecting compensation from the German state,” Løseth told the TT news agency when commenting on the decision.

Since 2007, Vattenfall has invested around 6.3 billion kronor ($1.02 billion) getting its German nuclear power plants in order – spending which can now be considered money washed down the drain for the Swedish state-owned energy giant.

However, there is an upside to the German decision, according to Løseth, in that Vattenfall’s other operations, such as coal-generated power plants, will become much more valuable.

“There’s no doubt that there will be an increase in value,” he said, adding that it was still too early to say for sure whether or not the increase would mitigate the costs related to shutting down the company’s nuclear power operations in Germany.

One of the factors that would affect whether or not Vattenfall could ultimately benefit is the outcome of compensation negotiations with the German state.

In a statement issued on Tuesday, Løseth said he expected “fair treatment” from the German state in negotiations over financial compensation.

Vi förväntar oss en rättvis behandling och att vi blir finansiellt kompenserade med anledning av det tyska beslutet, säger VD Øystein Løseth.

Germany’s decision has already had an effect on electricity prices – effects which show up in trading of future electricity deliveries.

And electricity on the continent will likely be more expensive, according to Løseth. However, prices in Sweden are more affected by the weather.

“A wet autumn has greater significance and probably results in lower prices than what we’ve had during recent winters,” he said.

According to Løseth, the Germany’s nuclear decision won’t bring about any changes in Vattenfall’s overall strategy.

Nor has he received any new directive from Vattenfall’s owners – the government and the Swedish state.

Løseth theorised that Vattenfall’s coal operations may also become even more important for Germany in the wake of the nuclear decision.

Despite Germany’s move to shutter its nuclear power plants, Løseth doesn’t see any plans for Sweden to follow suit.

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Sweden to stop local governments blocking wind parks in final stages

Sweden's government has proposed a new law which will remove local municipalities' power to block wind parks in the final stages of the planning process, as part of a four-point plan to speed up the expansion of wind power.

Sweden to stop local governments blocking wind parks in final stages

“We are doing this to meet the increased need for electricity which is going to come as a result of our green industrial revolution,” Strandhäll said at a press conference. 

“It is important to strengthen Sweden by rapidly breaking our dependence on fossil fuels, building out our energy production and restructuring our industry. The Swedish people should not be dependent on countries like Russia to drive their cars or warm their homes.”

“We are going to make sure that municipalities who say “yes” to wind power get increased benefits,” she added in a press statement. “In addition, we are going to increase the speed with which wind power is built far offshore, which can generally neither be seen or heard from land.” 

While municipalities will retain a veto over wind power projects on their territory under the proposed new law, they will have to take their decision earlier in the planning process to prevent wind power developers wasting time and effort obtaining approvals only for the local government to block projects at the final stags. 

“For the local area, it’s mostly about making sure that those who feel that new wind parks noticeably affect their living environment also feel that they see positive impacts on their surroundings as a result of their establishment,” Strandhäll said.  “That might be a new sports field, an improved community hall, or other measures that might make live easier and better in places where wind power is established.” 

According to a report from the Swedish Energy Agency, about half of the wind projects planned since 2014 have managed to get approval. But in recent years opposition has been growing, with the opposition Moderate, Swedish Democrats, and Christian Democrat parties increasingly opposing projects at a municipal level. 

Municipalities frequently block wind park projects right at the end of the planning process following grassroots local campaigns. 

The government a month ago sent a committee report, or remiss, to the Council on Legislation, asking them to develop a law which will limit municipal vetoes to the early stages of the planning process. 

At the same time, the government is launching two inquiries. 

The first will look into what incentives could be given to municipalities to encourage them to allow wind farms on their land, which will deliver its recommendations at the end of March next year. In March, Strandhäll said that municipalities which approve wind farm projects should be given economic incentives to encourage them to accept projects on their land. 

The second will look into how to give the government more power over the approvals process for wind projects under Sweden’s environmental code. This will deliver its recommendations at the end of June next year.