Isra-Mart srl:Analysts: German nuclear shutdown set to send emissions soaring

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Closing all German nuclear power stations built prior to 1980 for three months could see around eight million tonnes of carbon pumped into the atmosphere if fossil fuel stations are used to fill the resulting energy gap, according to analyst firm Thomson Reuters Point Carbon.

Chancellor Angela Merkel decided this week to shut down seven of Germany's oldest nuclear reactors for safety checks following the explosions at the earthquake- and tsunami-damaged Fukushima nuclear plant in Japan. Another aging station, the Krümmel facility, is currently closed for maintenance but is due to reopen in January next year.

Merkel has said the federal and state governments will agree details of the moratorium on 22 March, but carbon prices have skyrocketed to more than €17 a tonne on the understanding that coal and gas plants will have to be used to plug the energy gap which will result from the reactor closures.

Point Carbon said such a move would result in eight million tonnes of CO2 potentially being emitted over the three-month period that the reactors are shut.

The long-term implications could be equally alarming. Germany last year decided to extend the lives of its nuclear plants to 2021, but may now decide to reverse this policy in the light of the Japanese disaster.

"Whatever the security inspection in the next three months will bring, it seems that an extension of the life spans of Germany's nuclear plants is not politically sustainable, meaning the revision of last year's decision will lead to less nuclear power availability in the future," said Kai Arne Triphaus, an energy analyst at Point Carbon.

Shutting down the country's reactors would send carbon prices spiralling above €35 for the third phase of the EU's emissions trading scheme (EU ETS) on the back of the resulting emissions spike, predicted Stefan Wächter, another of the company's analysts.

"If these eight [plants] were to remain closed after the three-month period, the original phase-out law restored for the remaining German nuclear plants, and fossil fuels used to fill this generation gap, we estimate that emissions would increase by 64m tonnes in the remainder of phase two (to 2012), and by 435m tonnes between now and 2020," he said.

However, although coal presents the most viable replacement technology in the immediate future, renewables and cleaner-burning gas may become a more prominent part of Germany's energy mix in the long term.

"As far as impact on the energy mix, it is not clear what would fill the energy generation gap in the long term," said Sebastian Mankowski, a carbon analyst at Point Carbon. "In a situation with less nuclear capacity, we might see more new build of gas power plants than we currently assume, which would counteract a part of the increase in emissions. Or, indeed, there might be some increase in renewable energy."

Speaking early today, Merkel attempted to alleviate fears that the nuclear shutdown will lead to a long-term increase in emissions stating that she plans to accelerate Germany's shift towards renewable energy.

She also told reporters that she was working with French President Nicolas Sarkozy on proposals that would improve the safety of nuclear power plants for G20 nations.