Germany's largest energy company EON said Tuesday it would sue the government over plans to maintain a tax on spent fuel rods despite the intention to do away with nuclear plants by 2022.

"EON will sue over the nuclear fuel rod tax," the group said in a statement.

The levy on nuclear energy production was agreed with the government last year in exchange for an extension of the reactors' lifetime.

Retaining the tax while the reactors' lifespan is being greatly reduced was unfair, the company said.

"I reckon that the political decision to reduce of the plants' lifespan will entail losses of several billion euros," EON boss Johannes Teyssen told the daily Frankfurter Allgemeine Zeitung.

EON shareholders should not bear the cost alone, he said, in an interview to be published Wednesday.

"The cost of the energy overhaul must be borne by society as a whole," he added.

The government wants to retain the tax, amounting to about 2.3 billion euros ($2.9 billion) per year, despite its decision announced Monday to shutter all 17 of Germany's nuclear reactors within 11 years.

Eight have already been closed and will not reopen.

EON, one of four energy companies operating nuclear plants in Germany, said retaining the tax over the next decade would also reduce its ability to invest in renewable energies, needed to replace nuclear power, and would penalise it compared to European competitors.

The country's number two energy company RWE has said it would "leave the door open" to a lawsuit against the government over the fuel rods tax.

Germany became the first major industrialised power to agree an end to nuclear power in the wake of the disaster in March at Japan's Fukushima plant.

Chancellor Angela Merkel said the decision, hammered out by her centre-right coalition, marked the start of a "fundamental" rethink of energy policy in the world's number four economy.

A draft implementation plan to be debated next week would focus on hiking energy efficiency to reduce electricity use, building new power plants fired by natural gas and coal, expanding the production of wind energy, and improving the supply network from wind farms.

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