Relief for gas customers
Scholz praises expert ideas as “very good basis”
10/11/2022 12:41 p.m
At the mechanical engineering summit, Chancellor Scholz praised the expert commission’s proposals to relieve gas customers. Association President Haeusgen sees many companies affected and calls for a reformed electricity market at EU level. Scholz wants to massively expand renewables.
Chancellor Olaf Scholz welcomed the expert commission’s proposal to relieve gas customers. The SPD politician said at the German Engineering Summit in Berlin that the proposal was a “very, very good basis” for prices to remain affordable for companies and citizens and for nobody to be afraid of their bills. All companies would have to be sure that they could continue their production.
The expert commission set up by the government presented a phased model on Monday. This provides for a one-time payment this year and a gas price brake for private households and small and medium-sized companies as well as for industrial consumers in the coming year. Here in particular, the EU Commission has a say for reasons of competition law. A government spokesman said on Monday that the federal government wanted to examine the Commission’s proposal quickly and discuss its implementation.
The President of the Mechanical Engineering Association VDMA, Karl Haeusgen, said that the industry as a whole is still stable. However, many companies are affected by the enormous price increases for energy. “They not only affect us as a mechanical engineering company directly, but also through the threat to many suppliers. These two aspects are extremely challenging, especially for some medium-sized companies – especially if they have meanwhile received no offers from their suppliers for electricity or gas deliveries in 2023 get more.”
Urgently reform the merit order principle
Haeusgen said that changes announced at EU level on the electricity market could not be delayed. The merit order system must be reformed. The merit order is the order in which the power plants that are offered on the electricity exchange are used. The most expensive power plant required for the current generation of electricity determines the price of electricity. At the moment these are the gas-fired power plants. Due to the high gas prices, electricity prices have also risen. The result is that providers who produce cheaply – such as producers of renewable energies – earn a comparatively high amount.
Scholz confirmed that “extra profits” should be skimmed off. Maximum limits should be introduced for this. The coalition had announced that it would introduce an electricity price brake for basic consumption after introducing a revenue cap from its income. Germany can hope to get through the winter well, said Scholz. He referred to the well-stocked gas storage facilities and the construction of terminals in northern Germany for the import of liquefied natural gas. In addition, coal-fired power plants have gone online again, and the southern German nuclear power plants should run longer – but that’s not enough for the FDP.
Scholz criticizes the slow expansion of renewables
Scholz also said that there must now be a gigantic expansion of renewable energies, which is “progressing at a dramatic pace”. “That’s why I’m determined that this year we’ll loosen all the brakes that stand in the way of the expansion of renewable energies.” If he has anything to criticize about the decisions of the federal government in recent years, it is the fact that forms of energy such as nuclear and coal have been phased out, but not renewable energies, Scholz added.
The very first task must be that the prices for fossil energies go down again, said Scholz. The federal government will also promote this in Europe. A process at international level is also necessary, said Scholz, referring to the G7 countries, which also include the USA.