German state premiers urge EU to allow electricity subsidies for industry

The European Commission should allow member state governments to subsidise electricity prices for industry. That is what the premiers of Germany’s 16 federal states are calling for in the so-called “Brussels Declaration”. The German newspaper Handelsblatt reported.

The premiers of Germany’s 16 federal states have urged the EU to allow electricity price subsidies to support industry. In a joint “Brussels Declaration”, the state premiers are asking the Commission to allow national governments to introduce a so-called bridging electricity price for industry, which is currently under discussion in Germany.

The document, due to be published this week, says that the high costs of meeting energy needs are an “acute obstacle” to economic recovery.

“Member states must therefore be allowed to introduce a competitive bridging electricity price for a limited period, especially for energy-intensive businesses exposed to international competition, until affordable renewable energy sources are available on a sufficient scale,” the document says.

According to the report, the German state premiers will meet in Brussels on Wednesday and Thursday with European Commission President Ursula von der Leyen, the Commission’s new Executive Vice-President for the Green Deal, Maroš Šefčovič, and Energy Commissioner Kadri Simson.

In their statement, the premiers call for realistic and coherent Green Deal targets and add that small and medium-sized businesses need more targeted support.

“Given the pace of the transition to climate neutrality, care must be taken to preserve the international competitiveness of EU industry and ensure public acceptance,” the statement says.

The premiers also warn against placing an excessive burden on households. The middle class and low-income households need special support for the investments required.

German government divided over industrial electricity price

German Economy Minister Robert Habeck published details of his proposal for an industrial electricity price in May. His proposal would cap the wholesale electricity price at 6 cents per kWh (equivalent to CZK 1.42 per kWh) for a clearly defined group of industrial businesses. The cap would apply to 80% of businesses’ energy consumption and would remain in place until 2030.

Germany’s coalition parties, the SPD and the Greens, support introducing an industrial electricity price. Chancellor Olaf Scholz (SPD) and Finance Minister Christian Lindner (FDP), however, oppose it.