Consumers and industry can expect important relief in view of the rapidly rising prices. This Thursday, the Bundestag wants to decide on the price brakes from 9.30 a.m. The changes are expected to pass the Federal Council on Friday.
With the gas price brake, households and small and medium-sized companies are to be guaranteed a gross gas price of 12 cents per kilowatt hour for 80 percent of their previous consumption. For heat customers, the price should be 9.5 cents up to the 80 percent limit. For the remaining 20 percent of consumption, the normal contract price should apply – so an incentive to save should be retained.
For industrial customers, the price per kilowatt hour is capped at 7 cents net. When it is warm, it is 7.5 cents net. In industry, however, the statutory prices only apply to 70 percent of annual consumption in 2021.
The electricity price brake works in a similar way. It provides that households and small businesses receive 80 percent of their current consumption at a guaranteed gross price of 40 cents per kilowatt hour. For industrial customers, the limit is 13 cents for 70 percent of previous consumption.
The relief is limited until April 2024 and should take effect from March of the coming year. However, citizens and companies should also be relieved retrospectively for January and February by taking into account the benefits for the two previous months in March.
Even those who heat with substances that do not flow into the house via pipes should be relieved. Users of heating oil, pellets, liquid gas or even wood-burning stoves could benefit from this. Details are to be laid down later in an agreement between the federal and state governments, since the federal government wants to make up to 1.8 billion euros available from the economic stabilization fund, but the states should take care of the applications and payments.
The period from January 1 to December 1, 2022 is decisive. Consumers are still solely responsible for this until their heating costs have doubled compared to the previous year. The federal government wants to cover 80 percent of all additional costs, provided that the conditions for a subsidy of at least 100 euros are met. The upper limit per household is 2000 euros.
The Federal Association of Energy and Water Management (BDEW) was aghast. “The draft laws on the energy price brakes have turned out to be so complex that their practical implementation will be a mammoth task for the energy industry,” predicted Kerstin Andreae, Chair of the BDEW Executive Board. The industry will do everything to ensure that the relief reaches the citizens as smoothly as possible. Due to the complex conversion of IT systems, among other things, a smooth start on March 1st cannot be guaranteed.
According to Andreae, it is an “absolute novelty” that the federal government is transferring tasks to an industry that actually belong to the classic core area of the state. “The state must create a system as soon as possible so that it can pay out state support to the citizens in a targeted and income-related manner.” So far, there has been no such channel through which all citizens could be reached.
Companies that receive state support have to accept restrictions on bonuses and dividends. Dividends are distributions with which stock corporations allow their investors to participate in the profits. The bonuses here are not bonuses for ordinary employees, but payments to management bodies.
Anyone who receives more than 25 million euros in state aid may no longer increase bonuses and dividends that have already been agreed. Bonuses and dividends should no longer be paid out from 50 million. However, companies do not have to take advantage of this support and can continue to pay out bonuses and dividends in this case.
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