All the tribulations in Germany on energy prices
The crisis in electricity and gas prices in Germany is a problem for both households and businesses. The government is evaluating support measures, as it pushes the plan to cut emissions. All the details
Figures released last week say that 4.2 million households in Germany will see their electricity bills rise by 63.7 percent this year, and gas bills by 62.3 percent this year. The causes of the price crisis are many, but the main one is the reduced availability of natural gas in Europe ( Russia has something to do with it) which has increased the cost of the fuel in question and consequently also that of electricity.
WHAT THE SCHOLZ GOVERNMENT IS DOING
To mitigate the impact of the high bills on the most vulnerable social groups, the German government of Chancellor Olaf Scholz has decided to reduce the renewable energy support tax (it has an average annual cost of 222 euros); from 1 January 2023 it will be eliminated completely.
Berlin is also evaluating the allocation of 130 million euros to help families in economic difficulty pay their bills for domestic heating: half of German homes use natural gas for heating; a quarter of these use fuel oil instead.
However, the government may find it difficult to elaborate a broader response to the energy crisis due to its varied composition: the chancellor is a Social Democrat from the SPD, but the Greens (environmentalists and in favor of public spending) and liberals from the SPD are also present in the coalition. 'FDP (more conservative in tax matters).
THE OBJECTIVES ON EMISSIONS
Despite the significant share of renewable sources (27 per cent for wind power and 10 per cent for solar photovoltaics), Germany's electricity mix depends heavily on coal (24 per cent). Natural gas has a share of about 12 per cent, almost equal to that of nuclear power: but by this year the country wants to shut down all three remaining reactors.
The government has set itself the target of cutting carbon dioxide emissions by 65 percent compared to 1990 levels by 2030. It is a very ambitious target, even higher than that set by the European Union for the same date (-55 per one hundred). And which, according to the Ministry of Economy and Climate itself, will be achievable through a 20-25 percent reduction in energy consumption.
THE ROLE OF GAS
Berlin intends to upgrade wind farms throughout the country and complement natural gas with them, to compensate for the intermittency of the source and "protect" the electricity grid from periods of absence of wind. The Minister of Economy and Climate, Robert Habeck, specified that gas is useful in replacing coal-fired capacity, which is more polluting, but it is not a long-term solution.
By 2030, 80 percent of electricity will have to be generated from renewable sources. Meanwhile, the use of coal is increasing.
WHAT THE GERMAN CONFINDUSTRY SAYS ABOUT ENERGY PRICES
The BDI, the German industry association (the German version of Confindustria), said – as reported by Il Sole 24 Ore – that "all companies are suffering from the sharp increase in energy and electricity costs, which increasingly threaten their existence. The federal government must implement public co-financing of electricity tariffs ”.
The most penalized companies are energy-intensive ones, which consume large quantities of energy: the steel, ceramics and glass sectors, for example.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/energia/germania-prezzi-energia/ on Wed, 12 Jan 2022 10:15:10 +0000.