Exclusive: Germany plans to charge gas bills for all consumers

A general view of the gas storage facility at WINGAS near the northern German town of Rehden on January 7, 2009. REUTERS/Christian Charisius

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  • The proposal can replace the price adjustment clause
  • Levi could finance 1 billion euros per week of gas importers’ needs
  • An additional cost to increase the cost of gas for everyone

A proposal seen by Reuters on Friday showed the German government aims to levy a tax on all gas consumers to help suppliers facing a rapid rise in import prices.

The legislation is expected to pass by Parliament on July 8, according to industry and government sources.

A spokesperson for the Economy Ministry declined to comment on the proposal, but said the ministry regularly checks on existing sukuks and whether they can be completed.

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Germany is scrambling to put an emergency mechanism in place before July 11, when 10 days of scheduled maintenance for the Nord Stream 1 pipeline from Russia completely halted flows.

Experts warn that the outage could be extended, exacerbating the gas shortage and driving up prices.

The additional costs of replacing gas from Russia will be shared among all gas customers in a “transparent and non-discriminatory” procedure via Trading Hub Europe, an organization for gas network operators.

The tax would make the cost of gas to everyone rather than just certain households depending on who their gas supplier is.

If Parliament approves the plan, the government could introduce the tax in place of a general price-adjustment clause that would allow suppliers themselves to pass on price increases to customers.

Experts see the price adjustment clause as unfair and legally appealable. Energy attorney Peter Rosen told Reuters the clause states that only reasonable costs can be passed allowing for many interpretations.

Rosen said it was questionable whether contracts promising consumers fixed prices could be rescinded.

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The tax proposal would allow the federal government to trigger the general clause to adjust prices if there is a “significant disruption” to gas imports.

Dwindling Russian gas supplies have forced utilities across Europe to buy gas at high prices.

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Industry experts estimate that gas importers need about 1 billion euros ($1.04 billion) a week to cover the additional costs from higher prices, an amount the proposed tax could fund.

Germany’s Zukunft Gas lobby welcomed the proposal, saying that all consumers would have to jointly bear the additional costs.

“We are facing a financial crisis in the gas business that urgently needs to be addressed…Without rules on price adjustment, there is a risk of bankruptcies,” said Tim Keeler, managing director of Zukunft Gas.

(1 dollar = 0.9610 euro)

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(Covering) Written by Marcus Wacht, Tom Kakenhoff and Vera Eckert; Writing by Miranda Murray and Reham Elkousa; Editing by Rachel Moore, Maria Sheehan and David Evans

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