German utilities win big as court strikes down nuclear fuel tax

[FRANKFURT] German utilities scored a major victory on Wednesday when the country's top court declared a nuclear fuel tax as illegal, enabling E.ON, RWE and EnBW to claim back about 6 billion euros (S$9.33 billion).

In a long-awaited verdict closely watched by investors and analysts, Germany's Constitutional Court said the tax, which was imposed between 2011 and 2016, was "formally illegal and void".

Shares in E.ON, RWE and EnBW were up between 2.5 and 3.2 per cent on the news, with traders citing the prospect of them getting their money back.

The verdict marks the second victory by German utilities over the country's nuclear policy. The court in December ruled that a decision to shut down all nuclear plants following Japan's Fukushima disaster violated some of their property rights.

The fuel element tax required firms to pay 145 euros per gram of nuclear fuel each time they exchanged a fuel rod, which usually happens about twice a year. E.ON has paid about 2.8 billion euros, while RWE and EnBW have paid 1.7 billion and 1.44 billion, respectively.

REUTERS