Source: Energy & Management Powernews, 03 May 2022
After a meeting with representatives of medium-sized businesses, Economics Minister Robert Habeck announced the first aid because of the high energy prices already from this week, after EU approval.
In the morning of May 2, Federal Minister of Economics Robert Habeck (Green Party) had a virtual meeting with the associations of medium-sized businesses. This was about the challenges for medium-sized businesses from the aftermath of the Corona pandemic, the high energy prices due to the Ukraine war and the shortage of skilled workers. In a press statement afterwards, Habeck said that aid from the German government for companies could be applied for as early as this week. He counted on quick approval of the EU Commission.
At the same time, he dampened too high expectations: "Only about 4,000 companies will benefit from the supports because of the high energy prices, that is the hard truth," Habeck said. The money would not be enough to provide liquidity assistance or loans to all the companies affected by the high energy prices, he added. Nevertheless, he said, it should be prevented as far as possible that companies have to give up or leave the country.
Using high energy prices in the longer term as a signal for efficiency
Therefore, he said, his ministry would try everything in parallel, including helping with information and mediation platforms. He said that "an organizational framework" for restoring supply chains and recruiting skilled workers should be created. Consumers and companies in Germany must prepare for permanently high energy prices, Habeck said at the same time.
This should be used as an opportunity to move away from fossil fuels and implement efficiency measures. Despite the aid programs, the increased prices for energy and the procurement of raw materials would be passed on to customers. This, he said, must be borne by the national economy. "There is no other way to get through this period," he said.
Price increases also in 2023
Most companies have long-term energy supply contracts, he said. Therefore, they felt the high prices in full force only from the new contract negotiations with their suppliers from 2023. The prices for products would then increasingly go up, Habeck predicted. An aid package from the German government includes a loan program via the state development bank KfW and energy cost subsidies for companies. Habeck said direct subsidies are tied to very strict conditions.
EU energy ministers discuss in Brussels
Habeck will then travel to the EU energy ministers' conference in Brussels. There, he said, they will again discuss sanctions against Russia over the war in Ukraine. Germany also supports an oil embargo, he said. All refineries with the exception of PCK-Schwedt have now provided alternative supply chains, he said. For this company owned by Russian state-owned Rosneft, various solutions are being studied, Habeck said.
For crude oil, the barrel price could reach 100 euros on the world market. Some EU members are not yet ready for an embargo on Russian oil, he said. "I think we will find solutions in the collective wisdom of states," Habeck said, referring to the meeting. "The unilateral and non-contractual gas supply freeze to Poland and Bulgaria is completely unacceptable," he said.
Europe must work in solidarity and together on solutions to ensure security of supply in the coming months and next winter, he said. "And we must now drive the European energy transition forward in a united manner and with all our might," Habeck reminded. To this end, he said, the Commission's announced RE-Power-EU plan must include concrete measures - legislative and financial - to accelerate the expansion of renewables. "Less fossil, more renewables is now a question of national and European security and independence," Habeck concluded.
The European Commission will present its RE-Power-EU plan in mid-May with measures to quickly reduce the EU's dependence on Russian gas. The energy issue will also be on the agenda of the next meeting of heads of state and government on May 30 and 31.
The German economy minister had tested positive for Corona in rapid tests on Friday, April 29, and was quarantined. After a negative PCR test over the weekend, he had resumed his official duties.
Author: Susanne Harmsen