Costs for German energy price subsidies much lower than expected – media
Table.Media / Clean Energy Wire
The budget earmarked to finance Germany's cap on electricity and gas prices during the energy crisis is far from being used in its entirety, according to figures from the finance ministry reviewed by Table.Media. Of the 83 billion euros set aside for the energy crisis response, only 32 billion euros have been used, the article said. The price caps were introduced at the height of the energy crisis to limit the cost of electricity and gas for households, as well as for small and medium-sized businesses. The subsidies were originally set to run out at the end of the year. However, on 1 November, Germany's cabinet agreed to extend the caps through to 30 April 2024. “Even if energy prices have been declining since the start of the year, the energy markets are still – due to the geopolitical situation – quite volatile,” Korbinian Wagner, spokesperson at the economy ministry, said during a government press conference. It is still unclear what will happen to the remaining sum of approximately 50 billion euros, with the finance ministry saying unused funds would be added to the reserve of the economic stabilisation fund, Table.Media reported.
Since January 2023, prices on new energy contracts for households were already below the upper limits of the price caps, making them primarily useful for those with more expensive contracts from autumn 2022. Even in industry, where different prices apply, the price caps didn't apply in a significant way, Table.Media reported. In order for the extension to come into effect, it will have to be approved by the EU-Commission, making the situation uncertain for businesses. “The extension of the price caps can’t occur at the push of a button," said the head of the local utilities association VKU, Ingbert Liebling.
Germany's Monopolies Commission had called for the end of the energy crisis price subsidies at the beginning of October, saying direct payments to households were a better solution than intervening in price formation.
