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Gas storage facility of Stadtwerke Kiel: »Of course we want to prevent a wave of insolvencies«
Photo: Axel Heimken / dpa
In view of the exploding costs for electricity and gas, the municipal utilities in Germany are warning of widespread insolvency on the part of customers and insolvencies in their own ranks.
"We need an understanding between the federal and state governments regarding the liquidity problems of the municipal utilities and the development of a rescue package," said the chief executive of the Association of Municipal Enterprises (VKU), Ingbert Liebing, of the Reuters news agency.
So far, according to Liebing, payment defaults have been well below one percent of sales from delivered quantities.
That is "manageable".
At values of 5, 10 or even 20 percent, it could "be threatening for the public utilities." The VKU represents the interests of more than 1,500 companies, including mostly public utilities, with a turnover of around 123 billion euros.
"We're already noticing that the situation is getting more tense," Liebing continued.
»Just a few months ago, we recognized the risks on the horizon and said we had to prepare for them.
But now we are realizing that certain problems, liquidity problems, are becoming more acute." Overall, the public utilities are systemically important.
"Of course we want to prevent a wave of insolvencies, that's our top priority."
Prices have increased twelvefold in some cases
The energy industry is in turmoil.
Gas supply cuts in Russia have sent prices through the roof in recent months.
Large gas importers such as Uniper or Leipzig-based VNG have to be supported with billions because they have to cover Russia's losses with high losses on the expensive spot market.
But the "second row" - the public utilities and regional suppliers - sounded the alarm.
"If you now have to pay ten or twelve times as much for gas purchases as was the case in the past, then that poses enormous financial challenges for the municipal utilities, who first have to buy before they can sell," said Liebing .
In addition, higher security deposits are now required not only for trading on the stock exchange, but also outside of direct business, where most public utilities are active.
The VKU expert warned that if municipal utilities needed their entire liquidity and their entire credit line for trading, there would be no more scope for investments in the energy transition.
The 100 billion euro aid program set up by the federal government by the KfW development bank only helps those who trade on the stock exchange.
It must be improved.
It is possible that the 100 billion euros will not be enough if the program is extended to off-exchange trading.
dab/Reuters
