EU Approval for German Industry’s Subsidized Power Price Plan in Doubt
A recent document from the German Federal Ministry of Economics, obtained by the Handelsblatt, has revealed that the plan to help the industry by reducing the power price may face significant obstacles in the European Union.
The ministry’s experts have presented a concept for the industrial power price to the new Minister of Economics, Katherina Reiche, warning of the risks involved in EU approval. The document states that the implementation of the concept poses “substantial EU state aid challenges” and that the prospects for approval in Brussels are “highly uncertain.”
The concept, agreed upon by the Union and the Social Democratic Party (SPD) in their coalition agreement, aims to support the energy-intensive industry, which is struggling. The plan involves a power price of five cents per kilowatt-hour, which is expected to cost the federal government around €10 billion by the end of 2030. Eligible companies would come from “recognized trade- and energy-cost-intensive industries.”
According to the document, the plan requires a change to the EU’s state aid framework and the time is of the essence, as the formal consultation for the necessary amendment has already been closed. The ministry has suggested several steps to increase the chances of EU approval, including “a significant political backing from the government, which is considered essential.”
The ministry has declined to comment on the matter, as reported by the Handelsblatt. The fate of the plan, intended to help the struggling industry, now hangs in the balance, as it faces an uncertain future in the EU.