European Green Deal: German econ min calls for industry support - media
Frankfurter Allgemeine Zeitung
European industry must receive financial relief and other support as the planned Green Deal could lead to higher energy costs compared to international competitors, Germany’s economy minister Peter Altmaier has written in a letter to Margrethe Vestager, executive vice president of the European Commission, reports Frankfurter Allgemeine Zeitung (FAZ). “It may become necessary to take measures to compensate for the rising energy supply costs for the companies concerned,” Altmaier wrote. Under the coal exit plan approved in January 2020, the German government aims to introduce “appropriate support” for energy-intensive companies that compete internationally should power prices rise due to the phase-out. Such support needs approval by the Commission under state aid rules, writes FAZ. In addition, Altmaier wants to widen the circle of companies eligible for support, including those from the steel industry, as the EU Emissions Trading System (ETS) state aid guidelines are currently being revised, writes FAZ.
The power prices paid by industry is one of the most contentious aspects of Germany's energy transition and its economic impact. Business lobby groups routinely call the price of electricity a central threat to industry competitiveness. But sweeping claims in this debate hide the fact that there is no single power price for industrial consumers, but instead an exceptionally broad range of prices. Due to a complex system of taxes and levies, they depend on how much power companies need, when they need it, how they source it, whether they compete with rivals abroad, and many other factors. Because wholesale prices have fallen in the course of the Energiewende while taxes and levies have increased substantially, the price of power for industrial consumers in Germany can be both extremely high and extremely low. As German industry plans to use massive amounts of renewable electricity to reach climate targets, the power price is set to become even more important in the years to come.
