The plan is to continue the subsidy, until investment in renewables brings energy prices down.
Germany considers electricity price cap to support industry
05/05/2023May 5, 2023
Economy Minister Robert Habeck wants to support German industry for years to come with lower electricity prices. His electricity price cap proposal is intended to ensure that energy-intensive companies remain in Germany.
Germany’s Economy Minister Robert Habeck on Friday unveiled plans to cap electricity prices for energy-intensive industries to protect the sector from sharp cost increases.
According to the plan, the upper limit of €0.06 (roughly $0.07) per kilowatt hour (KWh) should apply until 2030.
It should cover at least 80% of the electricity consumption of a clearly defined group of German companies from energy-intensive industries such as chemicals, steel and glass manufacturing.
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Habeck, who represents the Greens in the government, is perhaps counterintuitively recommending that the taxpayer subsidize some of Germany’s biggest polluters. He described the proposal as a necessary long-term “bridge” solution until renewable capacity is expanded and prices fall. Otherwise, the government argues, there’s a risk that the major employers and sometimes systemically important industries relocate from the country.
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The idea was “economically unwise”, said Lindner, whose party the FDP has championed Germany’s balanced-budget orthodoxy.
This latest plan is economic insanity. Renewables will not produce a sustained fall in energy prices. Even if renewables were theoretically capable of delivering a sustained fall in energy prices, Germany is too far North. German solar panels barely work in Summer. In winter at best Germany sees a few hours sunlight per day, and the skies are frequently overcast.
Lets hope German leaders regain their senses, before they run out of money.
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Global warming, climate change, all these things are just a dream come true for politicians. I deal with evidence and not with frightening computer models because the seeker after truth does not put his faith in any consensus. The road to the truth is long and hard, but this is the road we must follow. People who describe the unprecedented comfort and ease of modern life as a climate disaster, in my opinion have no idea what a real problem is.
