German energy-intensive companies call for Europe-wide industry power price

Energy-intensive companies from Germany are calling for an EU-wide electricity price for industry as a simple instrument to safeguard the sector's global competitiveness during the continent's quest for climate neutrality. Industry has long argued that current power prices are too high. "A European industry power price would open the door for the decarbonisation of the EU primary industry and should be an elementary component of an EU industrial strategy," Rudolf Staudigl, CEO of chemicals maker Wacker Chemie, told business daily Handelsblatt. Wacker Chemie is a global market leader in the energy-intensive production of polycrystalline silicon, a key ingredient for PV modules, and competes with Chinese companies with significantly lower electricity costs, according to the article. "The German power price is at least twice as high as in western China," Staudigl said. Aurubis, Europe's largest copper producer, backs the idea. "We need a globally competitive power price. A European industry power price could guarantee this," said CEO Roland Harings.

Joachim Pfeiffer, energy policy spokesperson for Angela Merkel's conservatives CDU party, said a European power price for industry "would definitely be a better alternative to a carbon border adjustment mechanism" as proposed in the EU Commission's Green Deal and the EU's industrial strategy presented this week. Energy expert Matthias Buck from think tank Agora Energiewende* said a European industry power price could be "an important signal for industry that would create planning security for climate-friendly investments."

The power prices paid by industry are one of the most contentious aspects of Germany's energy transition and its economic impacts. 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.

*Like the Clean Energy Wire, Agora Energiewende is a project funded by Stiftung Mercator and the European Climate Foundation.