Swedish utility Vattenfall might not restart its error-prone reactor in Brunsbuettel, near Hamburg, because modernizing it might prove too costly, Vattenfall Chief Executive Officer Oystein Loseth said.
"We have to calculate the economic feasibility and will then make a decision," Loseth was quoted as saying by the Berliner Zeitung newspaper.
One of Germany's most problem-prone reactors, Brunsbuettel was taken off the grid in the summer of 2007 after a fire caused an emergency shutdown.
A similar incident at nearby Kruemmel, run by Vattenfall and German utility Eon, led to the reactor's closure in June 2007. It reopened in June 2009 but was taken off the grid again only a month later, when it shut down automatically after a transformer short-circuited.
Both incidents, poorly communicated by Vattenfall, damaged the company's reputation.
Vattenfall will decide this summer what to do with Brunsbuettel and Kruemmel, both built during the 1970s. The Swedes might hand over operating control to competitor Eon, which owns half of Kruemmel and a 33 percent share in Brunsbuettel.
Another competitor from Germany, EnBW, might shut down the older of the two reactors at its Neckarwestheim plant in southwestern Germany because modernizing it might be too costly.
The German government recently decided to prolong the life of the German nuclear reactors by an average of 12 years but linked this to several preconditions.
In return for longer running times, the utilities will have to pay a new "fuel-rod" tax of around $2.5 billion per year starting in 2011, support renewables with an additional $20 billion until the 2030s and retrofit their aging reactors to meet new, more stringent safety standards.
The likes of Brunsbuettel, Kruemmel and Neckarwestheim are among the older reactors that would have to be thoroughly improved to meet the government's safety demands.
For the utilities, it might make more sense to shut them down and transfer the running times to newer plants that wouldn't need remodeling, especially as power prices have been low for months, draining profits generated by the older reactors.
Vattenfall earlier this month said net income in 2010 dropped to $2 billion, down 2 percent compared to the previous year. The company's Germany business was abysmal, with profits plummeting by 26 percent in 2010.
Based in Stockholm, Vattenfall operates in Scandinavia, Germany, Poland, Belgium and Netherlands. At the end of 2010 it employed some 38,100 people.
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