Dutch energy executive Peter Terium is the most likely successor to RWE chief executive Jürgen Grossmann, according to company insiders cited in German news reports.

Grossmann, whose contract expires at the end of September 2012, defended RWE's investments in nuclear power plants vigorously but unsuccessfully against government plans to phase out atomic energy by 2022.

The 59-year-old's lobbying earned him the nickname "Atom-Rambo" and even prompted Germany's Nature and Biodiversity Conservation Union to award him the dubious title of "Dinosaur of the Year 2010."

News that Peter Terium, 47, is likely to be the fresh face to replace Grossmann surprised many observers. But the dark-horse candidate has been with RWE since 2003. He first RWE Supply & Trading and later oversaw the takeover of Dutch energy company Essent, which he currently heads.

RWE chief Jürgen Grossmann, left, may soon be replaced by Peter Terium

Other potential successors to Grossmann are RWE chief commercial officer Leonhard Birnbaum and chief operating officer Rolf Martin Schmitz. Whoever lands the top job is likely to face a turbulent time.

"One large challenge will be the task of bringing RWE's image - and the image of other energy companies - back into a positive light," a labor union representative told Reuters. "We expect a new orientation towards international and national energy politics from the new RWE chief."

Reinventing the wheel

Hubertus Bardt, an energy and environmental policy expert at the Cologne Institute for Economic Research, said Grossmann shouldn't be faulted for aggressively defending his company's substantial investment into nuclear power.

"Jürgen Grossmann is very well known as someone who fought for the future of nuclear power plants," he told Deutsche Welle. "But the fact is that he was fighting for the future of his company, and for the investment his company has made over decades."

Grossmann has been criticized for clinging to nuclear power for too long

Nevertheless, Grossmann in June characterized the political movement to phase out nuclear power as reckless, saying consumers would be hit with higher electricity prices and expressing fear that a slump in RWE stock value could leave the company vulnerable to a hostile takeover.

According to Bardt, Grossmann's stance runs counter to broader societal trends and political activity.

"He has been very, very prominent in a position advocating longer use of nuclear power, which in the end was not successful," Bardt said. "So that may be a problem in terms of public relations and of public acceptance of RWE."

Bardt added that RWE and companies like it needed to "find new markets and new business opportunities."

"They cannot go on with nuclear energy, and it's difficult and becoming less profitable for them to continue with coal-fired power plants, because the European emissions trading scheme makes emissions more and more expensive," he said. "These were two of the main pillars of RWE's energy production during the past years or even decades."

Urgent situation

Claudia Kemfert, an energy expert at the DIW German Institute for Economic Research and the Hertie School of Governance, said Grossmann has been "very old fashioned" in the way he'd handled new market challenges.

In July, RWE signed a strategic agreement with Russian state-run gas company Gazprom to jointly build or expand gas and coal facilities in a number of European countries.

The effects of RWE's deal with Gazprom have yet to be seen

"The company intends to increase the share of hard coal (plants) - a wrong decision, as we need more gas fired power plants," Kemfert told Deutsche Welle in an email. "Whether the Gazprom deal is really beneficial for the company has to be seen."

Kemfert added that although RWE has long been a lucrative business, it had failed to invest sufficiently in renewable energies. Germany's political goal of phasing out nuclear power actually began 10 years ago, she pointed out.

"The company had enough time to prepare a sustainable energy strategy," she said.

"Increased competition (from renewables) raises pressure for (conventional power) companies. This is indeed a new situation, as they dominated the market before."

"For the consumer, increased competition is not bad."

Author: Gerhard Schneibel

Editor: Sam Edmonds