November 23, 2015 / 11:18 AM / 4 years ago

UPDATE 2-E.ON, RWE could drop lawsuits as part of nuclear decommissioning deal

* E.ON, RWE have filed lawsuits against nuclear phase out

* Dropping suits depends on nuclear trust setup - sources

* Firms could transfer Urenco stake to trust - sources (Recasts, adds further details on E.ON)

By Tom Käckenhoff, Christoph Steitz and Vera Eckert

DUESSELDORF/FRANKFURT, Nov 23 (Reuters) - E.ON and RWE, Germany’s biggest utilities, could drop multi-billion-euro lawsuits against Berlin’s move to shut nuclear power stations if they get a favourable deal on decommissioning costs, two people familiar with the matter told Reuters.

Germany’s utilities have seen their profits dwindle following the country’s gradual shutdown of its nuclear plants, a decision taken following Japan’s Fukushima disaster in 2011.

The decision has triggered lawsuits from the country’s top utilities, including RWE, E.ON and Vattenfall, which are claiming billions of euros in compensation for what they say is expropriation.

E.ON has said it is claiming 8 billion euros ($8.5 billion). RWE has so far not disclosed its claim, which Deutsche Bank analysts estimate at about 6 billion euros.

“Dropping the complaint is subject to negotiations,” one of the sources said, adding this would depend on whether an amicable solution could be found for meeting up to 80 billion euros in nuclear decommissioning costs.

E.ON and RWE declined to comment.

The German government has asked a commission to make recommendations on how to safeguard the funding of the decommissioning by the end of January. A public trust, which would safeguard the nearly 40 billion euros in provisions set aside so far by the utilities, is one option under discussion.

E.ON and RWE’s provisions alone stand at a combined 27 billion euros, but there have been doubts over whether this can be backed up by their assets, which have fallen in value following years of declining power and share prices.

The sources said RWE and E.ON could transfer their stake in uranium enrichment company Urenco, in which they jointly hold a third on behalf of the German government, into the trust should it be set up.

RWE could also move nuclear plants, cash assets or even some of its equity to the trust, one of the people said, adding any asset transfer should happen over several years, ideally until 2022, when the last nuclear unit will be shut down.

“It makes a real difference whether this will happen over one year or seven years.”

$1 = 0.9402 euros Editing by Adrian Croft and Mark Potter

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