German economy minister wants to subsidize electricity prices for industry

German Economy Minister Robert Habeck has called for the price of electricity for industry to be subsidized with public funds. Otherwise, Germany could risk losing key technologies, he said at an event.

German industry has long complained that electricity prices put it at a domestic disadvantage in international competition. German Economy Minister Robert Habeck had previously announced his intention to present a plan for an industrial electricity price.

At an event organized by the RedaktionsNetzwerk Deutschland (RND) media group, he was more specific, according to a press release. Habeck called for the price of electricity for industry to be capped using public funds.

"The entire economy is currently talking intensively about an industrial electricity price, and I think we have to do this," Habeck said.

"If we cap prices, we will lose money; if we don't, we could lose the industries of the future," Habeck added.

According to Habeck, the industrial electricity price subsidy should last for four or five years. Germany must make sure that key industrial companies do not relocate abroad during this period, for example to China or the United States. The measure will require agreement within the federal government.

Securing electricity directly from offshore wind farms

According to the Ministry of Economic Affairs, competitive electricity prices are a prerequisite for industrial companies to transition to climate neutrality. As reported in January, the ministry has been working on an industrial electricity price plan for some time. The aim is to design a model for an industrial electricity price that is "as simple as possible" and can be introduced quickly.

Under the plan drawn up for the Ministry of Economic Affairs by energy market specialists Consentec, Enervis, Ecologic and the Fraunhofer Institute for Systems and Innovation Research, industry would gain access to cheap electricity from offshore wind farms through auctions. However, German industry would not be able to benefit from this proposal before 2029 to 2030. It remains to be seen whether the ministry can find a solution that could be implemented sooner.