GERMANY - FULL TEXT OF NUCLEAR PHASEOUT AGREEMENT

[Source: Bundesregierung Deutschland, "Agreement between the Federal Government and the Power Supply Companies of 14 June 2000", June 15, 2000]

I. Introduction

The dispute over the conscionability of nuclear energy has led to vehement debates and conflicts in our society for decades. Despite continuing differences of opinion with regard to the use of nuclear energy, the power companies respect the decision taken by the federal government to undertake an orderly phaseout of electricity generation based on nuclear energy.

With this in mind the federal government and the power companies agree to limit the future use of the existing nuclear power plants. On the other hand, the undisturbed operation of nuclear power plants and disposal of nuclear waste shall be guaranteed for the duration of the remaining period of nuclear power use, given the preservation of a high level of nuclear safety and compliance with the requirements of nuclear law.

Both sides shall do their part to see to it that the content of this agreement is implemented lastingly. On the basis of these fundamental positions the federal government shall draw up a draft amendment to the Nuclear Energy Act. The federal government and the power companies shall work on the assumption that the agreement and its implementation will not lead to compensation claims between the parties.

The federal government and the power companies see the agreement reached as an important contribution towards reaching a comprehensive "energy consensus". In the future the parties involved shall work together to continue to develop a power supply system in Germany that is environmentally acceptable and competitive on the European market. This will constitute an important contribution towards safeguarding as many jobs as possible in the energy sector.

II. Restrictions on the operation of existing nuclear power plants

1. For each individual nuclear power plant it shall be determined what maximum quantity of electricity it will be allowed to produce from 1 January 2000 until its decommissioning (residual amount of electricity to be generated). The right to operate a nuclear power plant shall end when the residual amount of electricity to be generated, as established or as changed through transfer to another power plant, has been reached.

2. The (net) residual amount of electricity to be generated shall be calculated as follows:

* For each nuclear power plant the remaining operational period from 1 January 2000 shall be calculated on the basis of a uniform maximum operational period of 32 calendar years from the beginning of commercial online operation. For Obrigheim a transitional period shall be agreed by 31 December 2002.

* In addition, a yearly reference amount shall be used which shall be calculated for each nuclear power plant as the average of the five highest annual productions between 1990 and 1999. The reference amount for the nuclear power plants as a whole shall be 160.99 TWh/a (not counting MŸlheim-KŠrlich).

* Compared to these reference amounts a 5.5% higher annual production shall be assumed for the remaining operational period on the basis of continuing technical optimisation, production increases in some nuclear power plants, and the changed reserve obligation for grid stabilisation resulting from deregulation and other factors.

* The residual amount of electricity to be generated shall be determined by multiplying the reference amount, increased by 5.5%, by the remaining operational period.

The residual amounts of electricity to be generated resulting for the individual nuclear power plants are listed in Annex 1. These residual amounts of electricity to be generated shall be laid down in the Annex to the amendment of the Nuclear Energy Act and shall be binding; item II / 4 shall not be affected.

3. The power companies agree to report the amount of electricity generated to the Federal Radiation Protection Agency on a monthly basis.

4. The power companies shall be able to transfer amounts of electricity (production rights) from one nuclear power plant to another on the basis of notification of the Federal Radiation Protection Agency by the operators in question.The negotiating parties are agreed that this flexibility shall be used to transfer amounts of electricity to be generated from less cost-effective to more cost-effective nuclear power plants. As such, amounts of electricity to be generated shall be transferred from older to newer and from smaller to larger nuclear power plants. Should amounts of electricity to be generated be transferred from newer to older facilities, this shall require an agreement between the negotiating parties in the framework of the Monitoring Group (cf. item VII) and the participation of the power company in question; this shall not apply if the newer facility is decommissioned at the same time.

5. RWE shall withdraw its application for the licensing of the nuclear power plant in MŸlheim-KŠrlich. The company shall also withdraw its damage suit against the State of Rhineland-Palatinate. With this agreement all legal and actual claims in connection with the licensing procedure as well as in connection with downtime for the facility shall be settled.

RWE shall have the right under the agreement to transfer 107.25 TWh in accordance with item II/4 to other nuclear power plants.

It is agreed that this amount of electricity to be generated shall be transferred to the Emsland nuclear power plant or other newer facilities as well as to the B and C blocks of the Gundremmingen nuclear power plant and a maximum of 20% to the Biblis B nuclear power plant.

III. Operation of the nuclear power plants during the phaseout period

1. Safety standards / government supervision

Despite differing assessments regarding the conscionability of the risks involved in the use of nuclear energy the two sides agree that the nuclear power plants and other nuclear facilities shall be operated at a high level of safety in comparison with international standards. They reaffirm their view that this level of safety shall be preserved.

The high safety standards required by law shall continue to be guaranteed during the remaining operational periods; the federal government will not taken any initiative to change these safety standards and the security philosophy they are based on. As long as the requirements of nuclear law are respected the federal government shall guarantee the undisturbed operation of the nuclear power plants.

For the further procedure regarding modernisation of the Biblis A nuclear power plant see the statement made to RWE AG by the Federal Ministry for the Environment contained in Annex 2.

The power companies shall carry out safety checks by the dates indicated in Annex 3 ("SSA" and "PSA") and submit the results to the supervisory authorities. This will constitute a practice already begun at the majority of the nuclear power plants.

The checks shall be repeated every ten years. The "PS†" shall not be necessary if the operator gives a binding declaration that it will end its operation of the nuclear facility within three years after the dates indicated in Annex 3.

The safety checks shall be carried out on the basis of the "PS†" manual.

If the manual is revised the Federal Ministry for the Environment shall involve the state governments, the Reactor Safety Commission, and the operators of the nuclear power plants.

The obligation to submit a safety check report shall become a standard requirement for operators under the law, with a view to supporting government supervision under Section 19 of the Nuclear Energy Act.

The independence and qualification of the GRS (Society for Reactor Safety) shall be guaranteed.

Research in the field of nuclear engineering, in particular nuclear safety, shall remain free.

2. Economic framework conditions

The federal government shall not take any initiative that discriminates against the use of nuclear energy as a result of unilateral measures. This also applies to tax laws. However, the cover reserve shall be expanded by increasing the so-called "second tranche" or by means of an equivalent arrangement to the amount of DM 5 billion.

IV. Disposal of nuclear waste

1. Interim storage sites

The power companies shall construct interim storage sites as quickly as possible at the locations of the nuclear power plants or in their vicinity. Joint efforts shall be undertaken to find ways of creating temporary storage facilities at these locations before the interim storage site are put into operation.

2. Nuclear fuel reprocessing

The disposal of radioactive waste from the operation of nuclear power plants shall be limited to direct final storage as of 1 July 2005. Up until that point in time transports for the purpose of nuclear fuel reprocessing shall be permitted. Supplied quantities may be processed. Reprocessing shall require prior proof of the unharmful use of the reprocessing products to be taken back.

In dealings with their international partners the power companies shall avail themselves of all acceptable contractual remedies to terminate reprocessing at the earliest possible point in time.

The federal government and the power companies assume that the residual amounts can be transported in the amount of time provided. They also assume that the licensing procedures for transports for reprocessing purposes can be completed by the summer of 2000 if the legislative prerequisites are in place.

Should it be the case that it is not possible to complete the process of reprocessing on time for reasons for which the power companies are not responsible, then both sides shall seek appropriate solutions early on.

3. Transports

As long as the relevant legislative prerequisites are in place the power companies shall be able to transport spent fuel elements to regional interim storage sites until the respective local interim storage sites are put into operation as well as out of the country until reprocessing is terminated. Both sides assume that the local interim storage sites will be ready for use in a period five years at most. The federal government, the state governments, and the power companies shall jointly create a standing coordination group for the purpose of carrying out transports. Its tasks shall include cooperation with federal and state law enforcement agencies.

4. Gorleben

Exploration of the salt dome in Gorleben shall be interrupted for at least three and at most ten years for the purpose of clarifying planning and safety-engineering questions.

The federal government shall make a statement with regard to the exploration of the Gorleben salt dome which shall be an integral part of this agreement and included as Annex 4.

5. Pilot conditioning plant

The responsible authorities shall conclude the licensing procedure for the pilot conditioning plant in accordance with the established provisions of law. Use of the plant shall be limited to the repair of damaged containers. A request for immediate licensing under nuclear law shall be made only in the case of acute need.

6. Konrad Mine

The responsible authorities shall conclude the plan determination procedure for the Konrad Mine in accordance with the established provisions of law. The applicant shall withdraw the application for immediate execution of the "plan determination decision" in order to make it possible for a court assessment of the merits of the case to be carried out.

7. Costs for Gorleben and the Konrad Mine

It is agreed that the costs for Gorleben and the Konrad Mine constitute necessary expenditure. As such, the power companies shall not demand repayment of advance payments made with regard to Gorleben and the prorated costs they were to assume for the Konrad Mine. The basis for this is the commitment made by the federal government to safeguard the Gorleben location during the moratorium (see in Annex 4 the statement of the federal government regarding exploration of the salt dome in Gorleben). The costs for keeping the facilities open shall be paid for by the power companies (prorated in the case of the Konrad Mine).

The power companies note that the federal government will make an effort to bring about a compromise settlement of claims for compensation on the part of the federal government against the State of Lower Saxony in connection with former supervisory decisions or the non-issuance of permits. The power companies declare that they will not assert repayment claims against the federal government with regard to the shares pertaining to them.

8. Proof of provision made for nuclear waste disposal

The requirement to provide proof of provision made for nuclear waste disposal shall be adapted to the contents of this agreement.

V. Amendment of the Nuclear Energy Act

1. The power companies note that the federal government intends to introduce a legal ban on the construction of new nuclear power plants as well as a legal requirement to construct and use interim nuclear waste storage sites situated close to the locations of nuclear power plants.

2. On the basis of these fundamental positions the federal government shall draw up a draft amendment to the Nuclear Energy Act (see the outline of the amendment in Annex 5). The parties conclude this agreement on the assumption that the Nuclear Energy Act to be amended, including the reasons given for it, will implement the contents of this agreement. Consultations shall be held between the negotiating partners on implementation in the Nuclear Energy Act amendment on the basis of the government draft prior to Cabinet discussion of the amendment.

VI. Safeguarding jobs

The federal government and the power companies shall attribute major importance to the safeguarding of jobs in the energy sector. The medium-term approach and, in particular, the possibility for flexible handling of remaining operational periods are intended to take this priority into account. The federal government and the power companies shall hold talks on how to create framework conditions for an energy supply system that is environmentally acceptable and competitive on the European market with a view to strengthening Germany's attractiveness as a place for investment in the energy sector. The result the parties want to achieve is to safeguard the largest possible number of secure jobs in our country through investments in power plants as well as energy services.

VII. Monitoring

A high-ranking working group shall be appointed to monitor the implementation of the joint agreements consisting of three representatives of the companies involved and three representatives of the federal government. Under the chairmanship of the Federal Chancellery Chief-of-Staff the working group shall jointly assess the implementation of the arrangements made in this agreement, as a rule once a year, and, if necessary, with the involvement of external expertise.

The agreement shall be initialled:

for the power companies by for the federal government by

........................................................... ......................................................................

Walter Hohlefelder, VEBA AG State Secretary Frank-Walter Steinmeier,
Federal Chancellery Chief-of-Staff

..........................................................

Gerald Hennenhšfer, VIAG AG

.......................................................... ....................................................................

Gerd JŠger, RWE AG State Secretary Rainer Baake,
Federal Ministry for the Environment, Nature
Conservation and Nuclear Safety

......................................................... ..................................................................

Klaus Kasper, State Secretary Alfred Tacke,
Energie Baden-WŸrttemberg AG Federal Ministry of Economics and Technology

Berlin, 14 June 2000

Annex 1

Residual amounts of electricity to be generated (net) for the individual nuclear power plants

Nuclear power plants Residual amounts as of 1 January 2000 (TWh net)

Obrigheim 8.70

Stade 23.18

Biblis A 62.00

Neckarwestheim I 57.35

Biblis B 81.46

BrunsbŸttel 47.67

Isar 1 78.35

Unterweser 117.98

Philippsburg 1 87.14

Grafenrheinfeld 150.03

KrŸmmel 158.22

Gundremmingen B 160.92

Philippsburg 2 198.61

Grohnde 200.90

Gundremmingen C 168.35

Brokdorf 217.88

Isar 2 231.21

Emsland 230.07

Neckarwestheim 2 236.04

Subtotal 2,516.05

MŸlheim-KŠrlich 107.25

Total 2,623.30

The table contains the residual amounts of electricity to be generated established for the individual nuclear power plants and which were calculated for each nuclear power plant as follows:

1. Down-to-the-day calculation of the remaining operational period on the basis of a uniform maximum operational period of 32 calendar years starting at the beginning of commercial online operation.

2. Calculation of a reference amount as the average of the five highest annual production amounts between 1990 and 1999 for each nuclear power plant (160.99 TWh/a for the nuclear power plants as a whole).

3. Increase of the reference amount by 5.5 %.

4. Calculation of the residual amounts of electricity to be generated as a product of the remaining operational period and the increased reference amount.

Annex 2

Statement by the Federal Ministry for the Environment made to RWE with regard to further procedures to be followed in connection with modernisation of the Biblis A nuclear power plant

On 27 March 1991 the Hessian supervisory authority issued after-the-fact regulations for the modernisation of Biblis A with regard to reactor safety standards. The Federal Ministry for the Environment reaffirms its view that modernisation measures as well as effective emergency systems are needed for reactor safety to ensure the continued operation of nuclear power plants over a period of several years.

The Federal Ministry for the Environment is currently assessing the extent to which the safe operation of Biblis A can be guaranteed up until such time as specific modernisation measures can be implemented. The result shall be communicated to the operator by the end of August at the latest.

The provisions of the agreement between the federal government and the power companies of 14 June 2000 stipulate that Biblis A will be allowed to produce a maximum of 62 TWH from 1 January 2000 until its decommissioning.

By the end of August 2000 at the latest the Federal Ministry for the Environment shall define measures for the Hessian licensing and supervisory authority aimed at accelerating licensing procedures; they shall include the restructuring of procedures and a definition of assessment criteria.

If the operator provides a statement that it will waive a transfer of power production amounts to Biblis A and the operator definitively fixes the amount of power yet to be produced, a modernisation programme will be approved within three months that will guarantee safe operation of the facility as well as be in reasonable proportion to the remaining time of use. In this case the regulations imposed after the fact shall be adjusted. The Federal Ministry for the Environment shall immediately begin with the necessary talks.

Annex 4

Statement by the federal government regarding exploration of the salt dome in Gorleben

In accordance with Section 9 a paragraph 3 of the Nuclear Energy Act the federal government has an obligation under the law to establish facilities for the final storage of radioactive materials. The federal government recognises this obligation and declares that it will undertake the necessary measures to provide needed final storage capacities for radioactive waste materials without prejudice to the phaseout of nuclear energy use.

Salt as well as other rock formations such as granite and clay may be given consideration as potential host rock formations for final storage sites. In 1979 the decision was taken to explore the salt dome in Gorleben as a possible final storage site. The geological information obtained thus far is essentially as follows:

In the course of analysing exploration area 1 (EB 1) the dimensions of the old rock salt formation being considered for the storage of highly radioactive waste turned out to be bigger than originally assumed. However, EB 1 is not sufficiently large for the predicted amount of nuclear waste.

Based on the analytically determined rise rate of the salt dome it can be expected with regard to potential rises that hazards will not have to be reckoned with as a result of this, even over very long periods of time (something on the order of 1 million years). No appreciable solution, gas, and condensation enclosures were found in the old rock salt formation. Previous knowledge of dense rock mass and the barrier function of salt was confirmed. Thus, the geological information obtained thus far does not suggest that the Gorleben salt dome would not be suitable for the intended purpose.

However, in connection with the ongoing international debate the federal government sees the need to expand the criteria for the suitability of a final storage site and to revise the plan for final storage of radioactive waste. The state of the art and general risk assessment techniques have advanced considerably over the past ten years; this has repercussions for the further exploration of the salt dome in Gorleben.

The following questions in particular give rise to doubts:

- The controllability of gas formation in the dense salt rock as a consequence of corrosion and decay of the waste materials constitutes a significant problem.

- Internationally there are increasing demands for the removability of radioactive waste materials. The current plan only provides for placing the waste in the salt formation and sealing it off.

- The suitability of salt as a host rock formation compared with others such as clay or granite needs to be studied in light of the knowledge accumulated in other countries.

- In connection with the direct final storage of spent fuel elements additional requirements will probably need to be fulfilled in order to rule out criticality (critical accumulation of fissionable material).

- The international Radiation Protection Commission is due to publish recommendations in the near future that will for the first time contain a radiation protection standard for unintentional human entry into a final storage site.

Further exploration of the Gorleben salt dome cannot contribute anything towards the clarification of these questions. For this reason exploration of the salt dome in Gorleben will be interrupted for at least three years, but at most for ten years; a rapid clarification of the above-indicated questions will be carried out.

The moratorium does not mean Gorleben is to be given up as a potential location for a final storage site. The purpose is to avoid investments during the assessment of planning and safety engineering questions that cannot contribute to the clarification of these questions.

The federal government will take the necessary measures to safeguard the Gorleben site during the moratorium. This includes the necessary legal steps to secure the position of the federal government as an applicant and to protect the project against interference by third parties. The federal government will take the necessary measures so that the request submitted for a ten-year extension of the framework operation plan will be granted for exploration of the underground site. The federal government will safeguard planning by means of a ban on changes of nuclear law (as provided for under Section 9 g of the Nuclear Energy Act).

Annex 5

Outline of an amendment to the Nuclear Energy Act

1. Fundamentally new provisions

1.1. Purpose of the law:

- to strike the purpose of funding

- to end the use of nuclear energy for the commercial generation of electricity in an orderly fashion and to ensure orderly operations up until the time of termination

1.2. Ban on permits for the construction and operation of new nuclear power plants

1.3. Research in the field of nuclear engineering, particularly nuclear safety, shall remain free

2. Time limitation of existing operational permits

2.1. Expiry of the right to commercial operation of the nuclear power plant in question when the amount of electricity for the nuclear power plant in question as indicated in the Annex to the law or as changed by transfer to another facility has been reached.

2.2. Calculation of operational periods

- Determination of a concrete amount of electricity for each nuclear power plant in an annex to the law

- Right to transfer the respective amounts of electricity to other facilities in accordance with the fundamental positions for an energy consensus

- Target direction: old to new

2.3. Report requirement for each power company regarding the amount of electricity generated each month

2.4. Responsible authority for receiving the reports: Federal Radiation Protection Agency (BfS)

3. Safety requirements

3.1. Compliance with current laws on safety standards

3.2. Obligation to carry out periodic safety inspections will become a standard requirement under the law

4. Waste disposal

4.1. Obligation to construct and use interim storage sites at or near the nuclear power plants

4.2. Legal provisions for interim solutions

4.3. As of 1 July 2005:

- restriction of waste disposal to direct final storage

- ban on reprocessing under item IV / 2

4.4. Maintenance of the "ban on changes of the law" introduced in 1998 by the amendment to the Nuclear Energy Act

"ban on changes of the law" to safeguard the Gorleben location during the moratorium (in Section 9 g)

4.5. Adjustment of the requirement for proof of provision made for nuclear waste disposal to the contents of the agreement

5. Abrogation of the amendment to the Nuclear Energy Act of April 1998

The amendment of 6 April 1998 to the Nuclear Energy Act shall be abrogated, except for:

- provisions regarding implementation of EU law

- ban on changes of the law (in Section 9 g, see above 4.4.)

6. Increase of cover reserve

Annotations to the outline of an amendment to the Nuclear Energy Act

(Annex 5)

1. With regard to item 4.1.

This requirement can be waived if a closure of the facility is planned and at the time of the closure there is no need for local interim storage while taking into account the provisions of "IV. Disposal of nuclear waste".

2. With regard to item 4.2.

The parties were agreed in principle as to the need for and the content of the provisions.

3. With regard to item 4.5.

The joint understanding is that proof of provision made for nuclear waste disposal is to provided on the basis of interim storage sites.

4. With regard to item 5.

In connection with the abrogation of Section 7 paragraph 2 sentence 2 only the clarification function intended by the preceding government will be abrogated.