The gas crisis threatens to worsen. The federal government is expanding its arsenal of instruments in order to be able to take countermeasures. She doesn’t actually want to draw “sharp swords”.

In the gas crisis, the federal government wants to protect consumers from price explosions by supporting energy companies. In addition, the state could invest billions in taxpayer money in ailing companies like Uniper.

To make this easier, the cabinet introduced legislative changes. A pay-as-you-go system is also planned as an option, so that gas price increases for energy suppliers can be passed on more evenly to customers. However, the federal government wants to prevent this instrument from having to be used.

“The situation on the gas market is tense, and unfortunately we cannot rule out a deterioration in the situation,” said Economics Minister Robert Habeck. “We have to prepare for the fact that the situation worsens.” Therefore, instruments should be sharpened. “It’s about doing everything possible to maintain the basic supply in the coming winter and to keep the energy markets running as long as possible – despite high prices and growing risks.”

Problems could worsen from July 11th

The background is the throttling of Russian gas supplies through the Baltic Sea pipeline Nord Stream 1. This caused Germany’s largest importer of Russian natural gas, Uniper, to experience turbulence and called for state aid. The problems could get worse. Annual maintenance work on Nord Stream 1, which usually lasts ten days, begins on July 11. The big concern is that Russia won’t turn on the gas tap again after the maintenance.

Uniper plays a central role in Germany’s energy supply and supplies many municipal utilities. However, the group cannot currently pass on additional costs when purchasing gas to customers. The Düsseldorf-based company had announced that this would result in significant financial burdens.

The federal government is negotiating with Uniper about state aid. It is possible that the federal government will participate. The “Handelsblatt” reported that the government was discussing that the federal government would subscribe to a package of new shares. In addition, a silent participation is under discussion. The volume could be between three billion and five billion euros.

As reported by a traffic light group, support measures by companies, for example through capital or the takeover of company shares by the federal government, could also be done against the will of the majority owner if necessary. In the Corona crisis, the federal government supported Lufthansa with billions of dollars and took a stake in the group.

Stabilization measures for energy companies as a priority

Habeck said: “We will not allow ourselves to have a systemic effect on the German and European gas market, because then domino effects will occur and other sectors or even the security of supply as a whole will be affected by a company bankruptcy.”

Some of the gas, which was ordered in Russia at comparatively cheap contracts, does not come. The contracts that energy suppliers have with public utilities or industry would have to be served. The energy companies would now have to buy gas on the market at immensely high prices and would therefore end up in the red. “That’s the problem. Companies can withstand this minus for a while, but certainly not indefinitely.»

Stabilization measures for energy companies should now have priority – so that gas suppliers do not terminate their customers’ contracts en masse and increase tariffs.

The FDP energy politician Michael Kruse said: “If companies get into difficulties due to the lack of gas deliveries, then they can be supported by the state under strict conditions. This can prevent large price jumps from hitting the market like a shock wave and causing damage.”

Allocation system should be created

At the same time, a mechanism is to be created as an option in order to be able to distribute the burden more evenly among all customers if the worst comes to the worst. This is a levy system – similar to the EEG levy to promote green electricity via the electricity bill, which has since been abolished. According to the Ministry of Economic Affairs, the existing price adjustment mechanism in the Energy Security Act is tighter and depends on which importer passes on the prices. The surcharge would apply to all gas customers and would be the same for all customers.

The general manager of the Stadtwerkeverband VKU, Ingbert Liebing, said that a surcharge would be far better than just passing on the price – such a charge could lead to a very high, short-term and unequal burden on gas customers. “But it is also important that we must prepare for further upheavals in the gas market. That’s why we also need an insolvency moratorium and the necessary agreements on a protective shield for public utilities as well.” The energy supply situation in the Federal Republic had never been so tense.

The Association of Consumer Organizations VZBV said the pay-as-you-go mechanism would certainly cushion price peaks for individual consumers. Nevertheless, the draft law has one side to the detriment of consumers, who mainly have to shoulder the prices – through the levy and indirectly through the tax-financed rescue package.

The federal government also wants to expand its toolbox for possible individual measures to save energy. Measures should also be able to be taken before the crisis occurs via ordinances.