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German solar energy firms face economic ruin

Buffeted by the bad economy and growing competition from Asia, German solar energy firms are facing financial ruin just as the industry fears the new government will abandon them.

German solar energy firms face economic ruin
Photo: DPA

“German solar energy companies are earning almost no money because demand has collapsed,” Jörg Sutter told the latest edition of business magazine Wirtschaftswoche.

“If a solar panel is a good investment for households, they are not very interesting for institutional investors,” he added.

Solar energy produces less than one percent of all electricity used by the biggest European economy and is currently heavily subsidised by the government.

According to weekly paper Die Zeit, state subsidies could cost Berlin a

total of €77 billion by the time they are finally phased out.

The sector knows that the money will run out, but companies fear the process will be sped up by a new centre-right coalition government that has also expressed interest in prolonging the life of Germany’s nuclear reactors.

In Spain, one of the biggest markets for solar panel makers, state funds no longer underpin sales.

German manufacturers have enjoyed several years of strong growth but are now being hit by an economic downturn and also face stiff competition from Chinese rivals.

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BUSINESS

France’s EDF hails €10billion profit, despite huge UK nuclear charge

French energy giant EDF has unveiled net profit of €10billion and cut its massive debt by increasing nuclear production after problems forced some plants offline.

France's EDF hails €10billion profit, despite huge UK nuclear charge

EDF hailed an “exceptional” year after its loss of €17.9billion in 2022.

Sales slipped 2.6 percent to €139.7billion , but the group managed to slice debt by €10billion euros to €54.4billion.

EDF said however that it had booked a €12.9 billion depreciation linked to difficulties at its Hinkley Point nuclear plant in Britain.

The charge includes €11.2 billion for Hinkley Point assets and €1.7billion at its British subsidiary, EDF Energy, the group explained.

EDF announced last month a fresh delay and additional costs for the giant project hit by repeated cost overruns.

“The year was marked by many events, in particular by the recovery of production and the company’s mobilisation around production recovery,” CEO Luc Remont told reporters.

EDF put its strong showing down to a strong operational performance, notably a significant increase in nuclear generation in France at a time of historically high prices.

That followed a drop in nuclear output in France in 2022. The group had to deal with stress corrosion problems at some reactors while also facing government orders to limit price rises.

The French reactors last year produced around 320.4 TWh, in the upper range of expectations.

Nuclear production had slid back in 2022 to 279 TWh, its lowest level in three decades, because of the corrosion problems and maintenance changes after
the Covid-19 pandemic.

Hinkley Point C is one of a small number of European Pressurised Reactors (EPRs) worldwide, an EDF-led design that has been plagued by cost overruns
running into billions of euros and years of construction delays.

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