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2022 10 09T224558Z 1 LYNXMPEI98097 RTROPTP 4 UKRAINE CRISIS GERMANY GAS - Business Express
FILE PHOTO: An open-grid gas pipeline is pictured amid the energy crisis due to the Russian invasion of Ukraine in Troisdorf, near Bonn, Germany, July 19, 2022. REUTERS/Wolfgang Rattay

German gas commission agrees proposals to ease impact of soaring prices

BERLIN (Reuters) -Germany’s expert commission charged with drawing up plans to ease the impact of soaring gas prices on consumers agreed on a set of proposals early on Monday, sources close to the talks said.

A draft of a paper seen by Reuters earlier showed the commission favoured the state giving households and businesses a one-off payment worth one month’s gas bill this year and a price brake from next March or April.

The commission is still working on a separate scheme for big gas consumers in the industrial sector.

In a second phase, the state could subsidize 60-80% of projected gas consumption, with consumers having to pay the remainder at market prices, incentivising energy savings. The subsidized price could come in around 12-14 cents per kilowatt hour (kWh), according to the paper.

If adopted, the scheme would be paid for by a 200 billion euro ($194 billion) relief package Chancellor Olaf Scholz’s government announced late last month to soften the impact of soaring energy prices on Europe’s largest economy.

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The commission will present an intermediate report at a news conference on Monday. The government is expected to take over its main findings. An economy ministry spokesperson said it did not have a finalised concept yet.

Experts say the upside of a one-off payment is that it provides immediate relief. The downside is that it provides no incentives to save despite estimates that at least 20% of gas savings are needed to avoid shortages.

The gas price brake takes longer to implement.

(Reporting by Markus Wacket; Writing by Sarah Marsh and Paul Carrel; Editing by Cynthia Osterman, Robert Birsel)


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