"We are now working to restore the public's trust and prove that we are a responsible company and a competent and reliable nuclear power operator," the state-controlled group said in its report of lower second-quarter earnings.

Chief Executive Lars Josefsson said he did not expect the German authorities to carry out threats to revoke Vattenfall's licence to operate nuclear facilities in Germany.

"In my judgement that would be an extremely unlikely situation, and I don't expect that to happen," he said in a conference call on the quarterly earnings.

The incidents, both classified as "zero" on the seven-degree international nuclear event scale which means "no safety significance", fed debate in Germany about the country's plans to shut down all nuclear reactors over the next two decades.

"We have acknowledged that our communication to the general public was insufficient," Josefsson said. "We mostly communicated in technical terms with authorities and maybe didn't really understand the anxiety of the general public."

The group's German unit boss resigned over the incidents, and the two reactors remain shut pending results of an independent inquiry into the accidents. Vattenfall said the shutdowns were costing it about 1 million euros per day.

Hans-Juergen Cramer, previously named interim chief of German unit Vattenfall Europe, will take over the post on a permanent basis, Josefsson said.

SETBACK FOR NUCLEAR CAUSE

At Brunsbuettel, the shutdown was caused by a short circuit at a switchyard outside the plant. At Kruemmel, it was caused by a fire in a transformer outside the reactor building.

The problems came as utilities seek to convince politicians in Germany and Sweden to allow them to keep nuclear power longer, arguing the reactors help to protect the environment as they do not emit the greenhouse gases and supply cheap power.

Atomic power plants have met massive popular resistance in Germany, leading the previous Berlin government to agree with utilities to shut down all nuclear reactors by the mid 2020s.

"These incidents have led to a discussion about the terms of the nuclear phase-out in Germany...and there has been a lot of demand to speed up the phase-out plans," said Josefsson.

Vattenfall said the EU's cap-and-trade rules for carbon dioxide emissions will boost its costs by roughly 440 million euros ($607.6 million) per year for its German fossil-fuel plants alone, if CO2 prices stay around 20 euros per tonne.

Josefsson said it was not clear how much of the carbon costs would be passed on to consumers, although forward prices on EU electricity markets were already rising due to CO2 costs."

"These (prices) will be determined by the market. What we see in the forwards is an upward trend which, among others, is based on costs of emissions certificates," he said.

Earnings before interest and tax at the Nordic region's biggest utility fell 6 percent to 5.47 billion Swedish crowns ($819.2 million) in the three months to end-June from 5.83 billion in the same quarter a year ago, the company said.

Operating profits fell mainly due to lower earnings from electricity distribution and a drop in heat sales, the state-owned company said.