When Germany announced its plan to phase out nuclear power stations last month, shares in the big four German power companies rose. The agreement made with the German government would see Eon, RWE, EnBW and Vattenfall pay a nuclear-fuel rods tax of €2.3bn until 2016 – but the market had been expecting worse.
But today Moody’s has warned that the impact of the tax might yet force a downgrade of the companies’ credit ratings.
With just a week to go until the US midterms, the narrative seems to have been set: the Republicans are going to do well because of anger at the Obama administration towards two things in particular: a lack of jobs and the healthcare bill.
But there may be another element at play which is feeding into this heady mix: the cap-and-trade bill.
Yesterday, the Journal published an interesting article about the way in which Democratic Congressman Rick Boucher’s support for the bill is losing him votes in his native Virginia. Apparently locals are angry that Boucher voted for a bill that they regard as anti-coal.
Yesterday’s confirmation that the government would protect £60m of spending on port infrastructure gave an important fillip to the UK offshore wind industry.
But today the industry had much more worrying news from Vestas, the market leader in this area, who have decided to slash 14 per cent from its overall workforce, at a cost of 3,000 jobs. Clare MacCarthy reports from Copenhagen:
Vestas, the world’s largest wind power company, is to cut up to 3,000 jobs – some 14 per cent of its global workforce – because of excess capacity and a cut in order expectations in Europe.
The closures of four production facilities in Denmark and one in Sweden were announced on Tuesday with the Denmark-based group’s third-quarter results. Net profits fell to €126m ($176m) from €165m a year earlier and sales declined 5.1 per cent to €1.72bn.
Ditlev Engel, the CEO, said:
Based on the expectations we have for 2011 in Europe, however, we must now recognise that a higher European level of activity will not be realistic – at least not in the short term.
Far from encouraging words for European offshore wind.