Saturday, May 30, 2015

The Lay(wo)men Who Govern Us

Contrary to his son Red Baron has little knowledge of financial matters. So I was shocked opening the Badische Zeitung of today reading an article: Finanzkonzept mit Fragezeichen (Financial concept, question marked).

A salt mine in 500 meter depth as "permanent" repository below Morsleben (©dpa)
Although in Germany the "permanent" disposal of highly radioactive waste is not yet solved I had so far assumed that its financing was at least assured by the provision of money nuclear power plant operators (PPO) must set aside according to our Atomic Law. These provisions - so far 38 billion euros - however are on shaky grounds. I learned that provisions (R├╝ckstellungen) must not be confused with allocations to reserves (R├╝cklagen). Provisions are costs the PPOs are placing into their balance sheets. These costs generally are no cash but money on paper and, e.g., may be covered by power plants that still have to earn their money. The biggest PPO, the RWE, alone must provide 10 billion euros for nuclear dismantling and disposal but the stock market value of the company is only slightly higher.

Since there are also hints that the present provisions will not be sufficient to finance the "permanent" disposal of radioactive waste from nuclear power reactors it will again be taxpayer's money to fill the financial gap and future generations to pay for.

Who made that law about the disposal of radioactive waste? Did the PPO's bamboozle the lay(wo)men of our government whose experts apparently did not know the difference between provisions and allocations to reserves? Now our Federal Government hastily tries to iron out the blunder. In the future the PPOs shall pay their radioactive waste money cash into a fund, a solution successfully practiced in Switzerland since the beginning of their nuclear age.

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