In the midst of the energy crisis, Germany decided to intervene suddenly and decisively in the market. According to the British press, the government led by Chancellor Olaf Scholz has pledged to pay all December gas bills for domestic consumers!
SMEs will also benefit from the same measure during the “gift month”.
Germany marks the money on the accounts of energy multinationals
This is all part of a wider plan by the Berlin authorities, which was drawn up after a series of recommendations from industry experts.
According to the publication The GuardianUnder the plan, full payment of bills in December will be followed by a staggered subsidy scheme in the spring, designed to cap bills but also incentivize consumers to save energy.
From March 2023 to the end of April 2024, German households will pay €0.12 per kilowatt hour for 80% of the gas they used the previous year! Aid under this scheme will also be granted to industrial companies, which will pay, from 1 January 2023 and until April 2024, €0.07 per kilowatt hour for 70% of the volume of gas used the previous year.
90 billion euros for support to the population
Expert group co-chair Dr Veronika Grimm said subsidized prices would be “a new normal for businesses and households so they can plan their consumption”. All without an artificial return to the low prices before the Russian invasion of Ukraine.
“In the future, prices will not fall to 7 cents. We will not receive Russian gas for a long time,” said Veronika Grimm.
Although the exact costs of the entire device are difficult to predict, Siegfried Russwurm, President of the Federation of German Industries.estimated that they will amount to 90 billion euros. The Scholz government will most likely implement the measures recommended by this expert commission, made up of 20 members from industry, trade unions and academia.
Moreover, at the end of September, Olaf Scholz himself announced a “defensive shield” of 200 billion euros to protect households and SMEs against rising energy prices. But at the time, he didn’t explain what that plan might consist of.