Major power utilities, including E.ON, RWE, EnBW and Vattenfall have set aside around $42bn in provisions for early decommissioning of the facilities.
The report by law firm Becker Buettner Held recommended part of the provisions to be taken over by the government in order to avoid a burden on taxpayers.
Reuters cited the report as saying: "A long-term financing need cannot be guaranteed by leaving the funds with the operators."
Germany is planning to shut down all of its nuclear plants by 2022.
Germany Economy Minister Sigmar Gabriel was quoted as saying in a letter that a public body could be created to tackle risks associated with the plant closures, and a framework would be established for nuclear liabilities in case the companies are restructured.
Balance sheets of nuclear operators will be evaluated to guarantee their provisions are sufficient, Gabriel said.
In the event of a bankruptcy, the companies will be asked to create an internal fund to ensure sufficient funds for demolition of nuclear plants.
The report said that ring-fencing the money in an external fund could pave way for the government to take over the control.
The Wall Street Journal cited nuclear expert Gerald Kirchner as saying that the costs for decommissioning could reach more than €50bn.
Germany is working to determine a suitable deep geological site for disposal of radioactive waste with plans to finalize a location by 2031.
According to the International Energy Agency, around half of the nuclear-power plants worldwide will be shut down by 2040.
