Prior to the February general election in Germany, the country’s industry leaders created alarm. He inspired the new German government to pay some high power prices and warned the companies shutting down and transferred abroad when nothing happened.
His concerns seem to resonate under the chairmanship of Chancellor Frederick Merz along with the new coalition government of Conservative CDU/CSU Party Alliance and Social Democrats (SPD).
Only after a few weeks in the office, it is planning significant relief measures, but some experts are warning of potential downside.
How high is electricity prices for the German industry?
A single figure is difficult to indicate, as the cost of electricity varies depending on the size and area of the company.
According to a study by the Bavarian Business Association (VBW) in Munich, Germany’s industrial electricity prices were around the European average in 2022. However, the impact of Russia’s entire scale invasion of Ukraine in February 2022 affects the energy markets, making it difficult to compare from year to year.
Recent European Union data suggests that Germany ranks third in the block about electricity prices for non-Housing consumers, including not only the industry and government offices such as public institutions, thus it is difficult to conclude the impact on the impact on the industry.
When it comes to the price of whalesl power – before taxes and fees – Germany is between international comparisons, Bruno Burger, Frounhofer Institute for Solar Energy Systems said the energy expert at Frankfurt Runschau recently.
Germany plans to live with America and China
One thing is clear, however, companies in the US and China make much less payments.
In 2023, according to the German IFO Institute Think Tank, and about 8 cents in China, according to the VBW data show, in 2023, industrial electricity prices were around 7 euros cents (about 8 cents) in the US through kWh-hour. In Germany, however, industrial firms pay about 20 cents, IFO says.
The plans of the coalition government in Berlin include extensive-based relief measures to reduce industrial electricity prices.
In Germany, the price of electricity is made of bulk price, as well as up to electricity tax, surcharge and grid fees. The grid fees charge fees to use the power network, while the specific government is funded.
Berlin is now planning to reduce the price of electricity by reducing the price of electricity by reducing power tax up to the European Union’s minimum and reducing the price of electricity by 5 cents per kilowatt.
The government therefore wants to expand and expand the price compensation program of electricity, which re-introduces energy-structured industries for the costs generated from CO2 pricing. The price of CO2 applies to discourage fossil fuels in Germany and emissions in the European Union.
Is this plan a good idea?
Energy and Climate Policy Specialist Andreas Fisher at the Colon-based German Economic Institute (IW) told DW that “from the consumer’s point of view, there is widespread-based relief.”
Max Jankovsky, CEO of Losenitz Foundry and President of Cammonitz Chamber, Industry and Commerce, Agreed, in a statement to DW tells that the urgency to reduce electricity prices for the industry is “recognized.”
But the plan is criticizing.
Swantje Fidler, scientific director of the Forum for Ecological Social Market Economy, says, “Lack of blankets in electricity prices refutes the needs of a system based on renewable energy.” Instead, the wood of the German energy system requires encouragement for energy storage and flexibility, he stated that DW is bound to ups and downs in Akshay Akshaya power supply, abundant supply in summer and rare in winter.
“At the same time, it is imported to consider how flexible a company can be,” says IW expert Fisher, “may not be suitable for changes in power supply or pricing to all firms.
Cheap electric professionals and opposition
Lyonhard Probest of the German -based Fronhoff Institute for Solar Energy Systems in Frebberg believes that low power prices may reduce the incentive to use electricity more efficiently for companies.
Probest, which manages energy-charts.
The Lössnitz would be looking for a case in the foundry point, as the company’s CEO Max Jankovski plans to switch to an electric smelting furnace from Coke. So far, however, high power prices are catching him back: “It seems that it is going on in a Bazsaw,” Herr said, permanently referring to the risk of high power prices.
Will Brussels thwart Berlin’s plan?
The coalition agreement of the ruling parties of Germany mentions more relief for energy-rah companies. It is not clear that it included the price of wholesale electricity, although some experts believe it is intended.
As shown in the price breakdown, taxes and overloads are already responsible for only a small hole of the final power cost.
Fraunhofer scientific probests warned that artificial low prices may retreat: “If the power is in low supply, but has been sold, the scattering intensifies and prices have increased,” they argued.
The German Chamber of Industry and Commerce (DIHK) sees another problem for the government on Energy, Environment and Industry, the head of Energy, Environment and Industry.
“A price cap wood intervenes with market pricing and possibly not permissible under the European Union’s State Assistance Rules,” Bole told DW.
Morovar, a price cap can be too high for taxpayers, probest said, many companies do not require relief, as energy costs make only a small part of their value construction, “will be unnecessarily benefitted.”
‘Silated measures’ makes more understanding
Swantje Fidler is sure that a sharp rollout of renewable energy in Germany will be “lower prices in long periods”.
In Meeantime, Probst said, “targeted subsidy” are more effective than a decrease in blanket value, and may include special electricity rates for the use of heat pumps.
Jankovsky said that he is calling “sewn measures”, which is especially to help small and medium -sized businesses (SMEs), given that many existing subsidies do not apply to them, which should be called, “and it requires almost happiness.”
This article was original in German.
