Siemens expects Germany's exit from nuclear power to cost the country up to 1.7 trillion euros ($2.15 trillion) by 2030, the head of its energy business said.
“We have calculated that between 1,400 billion and 1,700 billion will have to be invested in the German energy sector over the next 20 years,” Siemens board member Michael Suess, in charge of the company's Energy Sector, told Reuters.
“This will either be paid by energy customers or taxpayers,” he said at the annual Handelsblatt Energiewirtschaft conference.
The 1.7 trillion euros scenario is based on a strong expansion of renewables - with feed-in tariffs as the biggest chunk of costs - while the 1.4 trillion scenario emphasises gas as one of the major energy alternatives, he said.
Europe's biggest economy decided to abandon nuclear power after the massive earthquake and tsunami of March 11 hit Japanese reactors, causing an environmental disaster.
Siemens' estimate for the shift away from nuclear is much higher than the 250-300 billion euros estimate given earlier by Juergen Grossmann, chief executive of Germany's No.2 utility RWE. Grossmann, however, did not give a time frame for the investments.
Siemens' Energy Sector - which is active in several areas including power transmission, solar, wind and hydro power - achieved 27.61 billion euros in sales in the fiscal year 2011, or about 38 percent of group revenues, while profit came in at 4.14 billion.
Last year, Siemens said it aimed to benefit from the global push into renewable energy by installing power lines to get electricity from sun-drenched and wind-swept sites to customers.
At the time, it said the global market for power transmission of high-voltage direct current could triple in the next few years to 9 billion euros.
Suess added Germany's current renewable law (EEG) was insufficient in expanding renewable energy sources - above all, solar - in Germany in a sustainable way, adding the incentives were designed in a unfavourable way.
In Germany, generators of solar power receive a guaranteed price for their power for several decades, with no incentive to upgrade or modify their systems.
“We think that the energy system must not be a pawn of investors that aim to maximise their returns. The shift will not work with those incentives,” Suess said.
“One option would be to tie incentives to innovation, whereby owners of solar panels were forced to modernise their systems. Such incentives do not exist at the moment.” - Reuters