Standard content for Members only
To continue reading this article, please login to your Utility Week account, Start 14 day trial or Become a member.
If your organisation already has a corporate membership and you haven’t activated it simply follow the register link below. Check here.
Eon’s credit outlook is now negative following news last week that the German government will move to increase the energy giant’s nuclear decommissioning liabilities, according to Moody’s.
Eon saw its plans to spin off its nuclear assets in tatters after the German government said it would close a loophole which would enable the parent company to shrug off the costs of the government-mandated nuclear shutdown after five years.
As a result the credit ratings agency has revised its outlook for the company from stable to negative, saying that by continuing to hold these nuclear assets the company will be exposed to increasing political risk and scrutiny over the decommissioning of nuclear assets.
“There is heightened uncertainty around nuclear decommissioning costs in Germany and allocation of responsibility, with a continuing government debate on the creation of a public fund for nuclear decommissioning, the ongoing stress testing on nuclear provisions and the expected change in law, which would extend responsibility for nuclear decommissioning, dismantling and disposal obligations within any group that owns or has owned nuclear power operators,” Moody’s said.
The nuclear impairment charges, which touched €16.5 billion at the end of last year, mean the company is now expected to post a significant net loss in 2015 in the high single-digit billion euros.
The company has also seen its share price suffer, shedding 10 per cent in value since last week to around €8.50 shortly before midday, London time.
Please login or Register to leave a comment.