BERLIN (Reuters) - Germany's lower house of parliament overwhelmingly approved an exit from nuclear energy by 2022, setting the seal on a policy U-turn by Chancellor Angela Merkel driven by Japan's Fukushima disaster.
Opposition deputies from the center-left Social Democrats (SPD) and Green Party joined lawmakers in Merkel's center-right coalition in supporting the key measure in an energy reform bill in its third and final reading.
Calling it Merkel's "Waterloo," the SPD and Greens said ahead of the vote the nuclear phase-out vindicated three decades of bitter opposition to nuclear power in Germany.
But German industry and the country's neighbors fear the chancellor's change of heart on nuclear plants -- late last year she called them safe and advocated keeping them open longer -- could imperil the power supply in Europe's biggest economy.
The upper house (Bundesrat) debate on the package on July 8 will be a formality as the chamber representing Germany's states could only block the package with a two-thirds majority -- not likely in a house where Merkel is only marginally outnumbered.
The government, struggling to hit tough mid-term targets for reducing greenhouse gases, faces accusations from the renewable energy lobby that it has missed a chance to promote growth of wind and solar power more aggressively.
European Energy Commissioner Guenther Oettinger, speaking to a conference in Berlin as the Bundestag (lower house) debated the package of power laws nearby, said Germany's neighbors were worried about its programme of nuclear shutdowns by 2022.
He said closing the oldest eight of Germany's 17 nuclear plants after an earthquake and tsunami crippled Japan's Fukushima plant in March had already reduced the total European power supply by 2-3 percent, "which was manageable; the headlines were bigger than the cut."
But he added: "Europe must do what it can so the process of creeping de-industrialization does not proceed." He urged Berlin to coordinate the nuclear exit with its European Union partners to ensure stable power supplies and stop costs from rising.
Merkel, a conservative with one eye on her coalition's declining popularity and growing support for the Greens, has dismissed such worries, telling pro-nuclear neighbor France that Germany can get its power via renewable technology.
"This is more than consensus for a nuclear exit, this is consensus for a switch to renewable energy," she told the Bundestag earlier.
"We want to remain an industrial nation and sustain growth. But we want to organize that growth so that we guarantee quality of life for coming generations as well," she said, adding that solar, wind and biofuel technology would provide the key.
Lawmakers also voted to maintain Germany's current system of subsidies unchanged for the solar and onshore wind industries, and offer improved incentives for wind power generated offshore.
Germany, which gets close a fifth of its energy from renewable sources, aims to raise that figure to 35 percent by 2020, but industry representatives joined the SPD and Greens in arguing the reforms for that sector did not go far enough.
"The new energy bill is inadequate," renewable energy association (BEE) president Dietmar Schuetz said. "The government, despite its early move to exit nuclear energy, has failed to formulate ambitious goals for faster energy reforms."
Energy association BDEW estimated between 8-17 gigawatts of new capacity -- mostly greenhouse gas-generating gas and coal-based -- will have to be built over the next decade to counter the volatility of green power and to make up for lost nuclear capacity.
The opposition pushed through its own anti-nuclear power law when in government in 2002, but that was halted by Merkel last year -- until events in Japan "shocked" her, in her own words.
Of Thursday's package, the SPD and Greens approved only the nuclear exit law as the other legislation did not go far or fast enough toward renewable energy and away from nuclear and carbon fuels for their liking.
SPD leader Sigmar Gabriel, ridiculing Merkel's U-turn, told her in the Bundestag: "Today is nothing less than your Waterloo and your nuclear exit law is our nuclear exit law."
He said Merkel returned to power for a second term in 2009 with her Free Democrat (FDP) junior coalition partners "with only two projects in mind -- extending the lifespan of nuclear plants, and cutting taxes. You have achieved neither."
Renate Kuenast, parliamentary leader of the Greens, told Merkel: "I don't care if you have done it for electoral reasons or out of conviction. The historic irony is enough for me."
Writing by Stephen Brown; additional reporting by John Stonestreet; editing by Michael Roddy