Germany reaches multibillion-euro compensation deal for nuclear exit

The German government has agreed to compensate energy companies with around 2.43 billion euros (2.9 billion dollars) for losses incurred due to the nation's phasing out of nuclear power, federal ministries said on Friday.

The deal, which ends years of litigation, comes almost exactly a decade after the Fukushima disaster of March 2011, which prompted the Berlin government to announce an end to nuclear power in Germany.

The last German nuclear plant is to go offline by late next year.

Payments will be made to four nuclear energy providers to compensate them for lost business and investments rendered pointless by the radical energy policy.

Of those four, Vattenfall is to receive the largest share with 1.425 billion euros, followed by 880 million for RWE, 80 million for EnBW and 42.5 million euros for Eon/PreussenElektra, according to a joint statement from the ministries for environment, finance and the economy.

They said the breakthrough puts years of legal battles to bed, including a challenge brought to the International Centre for Settlement of Investment Disputes (ICSID) in Washington, in which Vattenfall originally sought 6 billion euros in damages.

The Constitutional Court ruled back in 2016 that nuclear energy providers were entitled to compensation - and last year sent the government back to the drawing board, ruling that a framework devised to pay out such compensation was insufficient.

The German government's nuclear phase-out policy was announced within months of energy companies receiving permits to extend the lifetime of their nuclear plants.

The compensation agreement still has to be approved by the boards of the energy companies, after which a contract will be drawn up and presented to the German parliament. The final deal for financial compensation is to be anchored in law.