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Germany is set to soon unveil measures to alleviate the impact of soaring energy prices on consumers, with steps likely to include a one-off payment and subsidizing more than half of the expected gas consumption, sources close to the talks at the German expert commission told Reuters on Monday.
The ideas that the expert commission adopted early today are to give households and businesses a one-off payment worth a month of their respective gas bills, and subsidize between 60% and 80% of the expected gas consumption, while consumers will pay the rest at market prices, according to a draft proposal Reuter has seen earlier. The commission will propose measures to blunt the impact of soaring energy prices on large industrial consumers at a later stage.
The measures, if adopted by the German government, will be part of and paid for by the planned $194 billion (200 billion euros) “defensive shield” to protect companies and consumers against the impact of soaring energy prices. At the end of September, the German government that it would ditch earlier plans for a gas levy on consumers and instead would introduce a gas price cap to curb soaring energy bills.
A one-off payment, as proposed by the expert commission, would be an immediate relief for residential and business consumers. But the subsidized gas bills could discourage consumers from savings. This would be the opposite of what Germany’s expert commission aims to do with a smaller part of gas consumption paid at market prices by consumers.
Germany’s energy regulator insists that “significant” gas and energy savings are necessary to avoid a winter of rationing and gas emergency. Households, industry, and businesses need to cut consumption by at least 20%, Klaus Müller, the president of the Federal Network Agency, Bundesnetzagentur, said last week.
Germany’s gas consumption rose in the latest reporting week to September 30 by 10% to 618 gigawatt hours per week (GWh/week) from 483 GWh/week in the previous week, and was above the average for the same week between 2018 and 2021, showed data from the agency, the regulator that would impose rationing in case of severe shortages.
