E.ON SAYS NEEDS BENIGN CO2 REGIME TO BUILD PLANTS
12.29.06 - Leído 249 veces. Enviar esta notaUtility E.ON needs favourable EU rulings on carbon dioxide (CO2) quotas if it is to proceed with billions of euros in planned power station investments in Germany over coming years, it said on Thursday
FRANKFURT, Germany; December 29, 2006.- Chief Executive Wulf Bernotat placed question marks over investment plans the group had specified earlier in the day, should Germany’s government lose a row with the European Commission over tougher rules for CO2 output in 2008-2012 and if Brussels rejects special rules for new German plants.
Brussels and Berlin are locked in a controversy over pollution limits which are aimed at fighting climate change.
The current stance taken by Brussels made “unviable” parts of the 11.4 billion euros (US$15 billion) set aside by E.ON for modernising and building new plants within a 25.3 billion euros fixed asset investment plan for 2007-2009, Bernotat said.
“We assume that common sense will prevail,” Bernotat said in a conference call.
“If not, we must change our investment plans accordingly.”
His remarks came a day after sector peer RWE voiced doubts over 4.4 billion euros worth of investments in three power generating plants it had announced three weeks ago.
Like RWE, Bernotat linked the potential damage to investments from the discussions over CO2 permits, which highly polluting power generators must hold under the EU carbon trade scheme, to further threats from proposals to change cartel law.
These changes are sought by Economy Minister Michael Glos in a bid to boost competition in a high-price power sector which has won E.ON, RWE and others high profits but burdens consumers.
Bernotat said Glos was “working against the market trend” and discouraging domestic and foreign investors alike.
He also said that a decision in a one-year probe by the cartel office, into whether utilities may price CO2 permit costs into power prices, was due over the next few days.
The length of the probe showed it must be hard to find proof of any abuses of market power, Bernotat said, adding that E.ON would challenge any condemnation of the practice.
“We will challenge it legally if required,” he said.
(Reuters)
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