Nuclear profits remain a sore point

The report from the National Bank of Belgium
(NBB) on the nuclear windfall profits gained by Electrabel will not be presented to the government until later this week, but it is already causing controversy. Last week Le Soir newspaper claimed to have learned that the bank will estimate the profits to be between €750 and €900 million – close to Electrabel’s own estimate of €650 million but far away from the sum of around €2 billion estimated by the industry regulator Creg. Creg’s director of pricing, Guido Camps, has threatened to resign if the NBB took Electrabel’s side.

Now Paul De Grauwe, a respected economist and professor at the Catholic University of Leuven, has claimed that the NBB "allowed itself to be used" by taking on the job of drawing up the report in the first place. The nuclear windfall - the profits made by Electrabel and, to a lesser extent, by SPE-Luminus since the writing-off of the costs of Belgium's nuclear reactors - is a political question, De Grauwe said, and the NBB's involvement risked compromising its independence.

The question is important in determining how much of a windfall tax the government can get the energy producers to pay. Last week finance minister Didier Reynders floated a figure of €500 million.

(April 27, 2011)