By Alexander Wilhelm and Joachim Grittmann

The Federal Constitutional Court of Germany (FCC) on December 6 ruled that while the phase-out of nuclear energy (enacted in 2011) is in compliance with the constitution, Germany’s energy suppliers which operate nuclear power plants have to be compensated “reasonably”. Although the German legislator is primarily obliged by the court ruling to draw up new provisions by June 2018, energy suppliers have indicated their willingness to start negotiations with the Federal Government.

As a result of the Fukushima accident in March 2011, the legislator enacted fixed end dates for the operation of nuclear power plants in July 2011. It was an extreme reversal considering that the German government, only a few months before, put forth a modified energy policy in which nuclear energy should be prolonged as a “bridging technology” by an average of 12 years for each nuclear power plant. The law of 2010 increased electricity output allowances. Accordingly, energy suppliers challenged the withdrawn prolongation in their constitutional complaints against the recent amendment of the Atomic Energy Act (Atomgesetz). However, they did not object to the fundamental decision in favor of a phase-out of the nuclear energy taken in 2002 (Atomausstieg), nor were energy suppliers able to claim a concrete amount of compensation before the (FCC). Crucially, there was a gap between the guaranteed residual electricity volumes and the short-term operational lifetimes of the plants.