E.ON AG (EOAN) led declines among Europe’s nuclear utilities on concern that explosions at two Japanese reactors may spur governments to backtrack on plans to expand atomic energy. Renewable power and natural-gas stocks rose on prospects for increased demand.

E.ON, Germany’s largest utility, fell 5.3 percent to close at 21.865 euros in Frankfurt, the biggest drop since May. Electricite de France SA, the world’s largest operator of reactors, also slumped 5.3 percent. German solar cell producer Q-Cells SE (QCE) jumped 15 percent, wind turbine maker Vestas Wind Systems A/S rose 7.4 percent in Copenhagen, and natural gas producer BG Group Plc (BG/) gained 3.7 percent in London.

The potential risk of a meltdown at a plant outside Tokyo after last week’s earthquake and tsunami may prompt governments to rethink plans to use nuclear energy as part of an effort to cut carbon emissions and maintain energy security, according to UniCredit SpA. That could increase demand for solar panels, wind turbines and gas, a cleaner-burning fossil fuel, as an alternative.

source: bloomberg