Old radiators after a building renovation
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Daniel Karmann / dpa
On Wednesday evening, the federal states discussed in a special conference how they want to deal with the energy crisis.
Thuringia's Prime Minister Bodo Ramelow (left) then demanded movement from the federal government: "Now the traffic light coalition must finally take hold and also declare its willingness to tackle the necessary solutions together with us," Ramelow told the editorial network Germany (RND).
The people were waiting for resolute "and united action."
This was at least successful on the state side.
At a special conference on Wednesday, the heads of government of the federal states discussed, among other things, how to deal with the energy crisis and its consequences and how to finance possible relief for citizens.
Together they called for an energy price cap for electricity, gas and heat in order to limit the explosion in costs for private households and companies.
In general, the debate seems to be going more and more in the direction of the lid after the unsuccessful gas levy plans.
The President of the German Institute for Economic Research (DIW), Marcel Fratzscher, supports demands for an energy price cap.
"In principle there are certainly better solutions than an electricity and gas price brake, but in this emergency such a brake is the best option," said Fratzscher of the "Rheinische Post".
"If you design it intelligently, it can set the right incentives for savings and also create noticeable relief for companies and people with medium and low incomes," says Fratzscher.
When trying to find a solution, politicians must above all ensure that people with low incomes are sufficiently relieved, that a solution is found and implemented quickly and that this solution is also “reliable for the next two winters”.
Middle class 'appalled' by government work
At the same time, he called for greater financial participation by the federal states in the planned relief.
"The federal states should also take on more responsibility and not shift the vast majority of funding to the federal government, especially since most federal states are in a comparatively good financial position."
"Many entrepreneurs are appalled by the government's work so far," said Markus Jerger, Managing Director of the Federal Association of Small and Medium-sized Businesses (BVMW).
»The many small and medium-sized companies have their backs to the wall and there is neither concrete help nor concrete announcements from Berlin.
There is no clear line," criticized Jerger in the "Rheinische Post".
The current energy crisis and the associated energy price crisis is the greatest economic challenge since the founding of the Federal Republic, in view of this he showed no understanding for the disagreement between the federal and state governments: "As if the drama of this situation and the associated consequences had not yet been understood, the federal and state governments are arguing about the financing of relief packages, the design of relief packages, the small print in contracts.«
Many medium-sized companies are still in the process of processing the effects of the corona crisis and are now confronted with a surge in energy prices, which is threatening the existence of many, said Jerger: »The German business model is up for discussion, the competitiveness of the companies and their viability are in one hitherto unknown levels of endangerment.«
Lid modeled on Spain and Portugal
According to the Vice President of the Bundestag Katrin Göring-Eckardt, important groundwork should be laid on these issues by the end of the week.
It is clear that “by the end of this week we will have a solution as far as the question of the gas surcharge is concerned, and as far as the question is concerned: what do we have instead?
is there a lid
And where does the money come from?” The Greens politician said on Wednesday evening on the ARD talk show “Maischberger”.
Göring-Eckardt said that there must be further relief for people - "regardless of whether it is about the master baker or the private consumer." The traffic light coalition is therefore discussing the financing of the relief so vigorously, because it is a coalition "where people do not come from the same basic attitude," explained Göring-Eckardt.
Under pressure from many EU countries, the European Commission has made new proposals for a possible European gas price cap.
According to a discussion paper available to the German Press Agency, the EU must be ready to introduce measures to limit prices.
"The main goal of the EU is to guarantee lower prices for consumers this winter." However, the Brussels authorities only partially respond to the wishes of the EU states.
Specifically, the EU Commission is proposing, among other things, to set a maximum price for Russian gas.
Another option is to cap the price of gas in electricity production in order to lower the price of electricity as well.
Spain and Portugal have already introduced something similar.
The paper does not detail exactly what that would look like across Europe.
The price difference between the cap and the market price would be borne by the electricity system, it says.
Greece, Italy, Belgium, France and eleven other countries had previously asked the EU Commission in a letter to present a proposal for a maximum price for gas.
This should relate to gas deliveries from abroad - such as imports from Russia and other countries - but also to transactions at wholesale centers within the EU, the letter said.
Pricing mechanism should remain in place
In its paper, however, the EU Commission warned of possible negative measures of a price cap.
“If pricing action is taken in isolation, there is a risk that it will increase demand rather than address the underlying shortage.” The Commission also wrote that capping European wholesale prices – rather than just imports – would require a centralized system to replace the market and ration and allocate gas.
That would be "unprecedented."
There is no organization at European level that can technically regulate this at the moment.
Even before that, the EU Commission relied on proposals that basically leave the price mechanism in place.
So she suggested first skimming off the excessive profits of oil and gas companies and many electricity producers and using the money to relieve consumers instead of setting a maximum price.
On Friday, EU energy ministers will hold a special meeting in Brussels to discuss the measures.
They are expected to agree on the confiscation of excess profits.
The gas price cap is also to be discussed.
Germany and other countries had spoken out against it.
mamk/dpa/Reuters
