2011 Annual Report - OTCIQ.com

134 Notes
As of December 31, 2011, €7.7 billion in contractual obligations
(€3.4 billion due within one year) are in place for the purchase
of electricity; these relate in part to purchases from jointly
operated power plants in the Generation unit. The purchase
price of electricity from jointly operated power plants is generally
based on the supplier’s production cost plus a profit
margin that is generally calculated on the basis of an agreed
return on capital. The decrease in contractual obligations for
the purchase of electricity compared with December 31, 2010,
is primarily the result of the shutdown of several jointly operated
power plants.
Other purchase commitments as of December 31, 2011,
amounted to approximately €3.2 billion (€0.3 billion due within
one year). In addition to purchase commitments primarily
for heat and alternative fuels, there are long-term contractual
obligations in place at the Generation unit for the purchase
of nuclear fuel elements and of services relating to the interim
and final storage of nuclear fuel elements.
Payment obligations had also arisen from the eleventh amendment
of the Atomgesetz, which took effect on December 14,
2010, and provided for the allocation of additional output for
nuclear power plants. The law as amended was to have the
effect of prolonging the lives of these nuclear installations.
In that context, the operators of nuclear power plants had
(28) Litigation and Claims
A number of different court actions (including product liability
claims and allegations of price fixing), governmental investigations
and proceedings, and other claims are currently pending
or may be instituted or asserted in the future against companies
of the E.ON Group. This in particular includes legal actions
and proceedings concerning alleged price-fixing agreements
and anticompetitive practices. In addition, there are lawsuits
pending against E.ON AG and U.S. subsidiaries in connection
with the disposal of VEBA Electronics in 2000.
The entire sector is involved in a multitude of court proceedings
throughout Germany in the matter of price-adjustment
clauses in the retail electricity and gas supply business with
high-volume customers. These proceedings include actions
for the restitution of amounts collected through price increases
imposed using price-adjustment clauses determined to be
invalid. The legal issues involved have not yet been definitively
addressed at the highest judicial level. Companies of the
E.ON Group are also involved in legal proceedings in this area.
made an undertaking to contribute to a fund that would have
been used to finance measures to implement the German
federal government’s energy concept. The underlying agreement
with the Federal Republic of Germany was signed on
January 10, 2011. Once the thirteenth amendment of the Atomgesetz
takes effect, the support fund agreement will no longer
constitute a basis for additional payments.
Further financial obligations in place as of December 31, 2011,
totaled approximately €4.6 billion (€1.7 billion due within
one year). Among others, they include financial obligations
from services to be procured, obligations concerning the
acquisition of shares and the acquisition of real estate funds
held as financial assets, as well as corporate actions.
The courts have shown a noticeable sector-wide tendency to
rule against the utilities. This is illustrated by a judgment of the
Federal Court of Justice (“Bundesgerichtshof”) against EWE AG
in July 2010 concerning the validity of gas price adjustments
and the legal status of unconditional remittances. The potential
effect of this ruling on the companies of the E.ON Group
cannot yet be evaluated definitively. It remains to be seen how
case law will develop in other respects.
On July 8, 2009, the European Commission imposed a fine of
€553 million on E.ON Ruhrgas for joint liability in alleged
market-sharing activities with GdF Suez. E.ON Ruhrgas and
E.ON filed an appeal against the Commission’s decision
with the General Court of the European Union in September
2009. The appeal does not have suspensory effect, and the
fine was thus paid when due in October 2009. Further proceedings
in this matter cannot be ruled out.