Germany: Energy suppliers under the specter of bankruptcy

The giant efforts of the government to prevent the worst in the energy sector in the pages of the press. Energy saving “exercises” for consumers.

The historic challenges facing Germany with the now visible risk of bankruptcy of energy suppliers due to Russian energy interruption, are pushing the government to fast track legislative procedures. The financial audit Handelsblatt has at its disposal a new arrangement, according to which the state will be able, in the model of support measures in the fight against the economic consequences of the pandemic, to participate in the corporate capital even without voting rights, in order to support them.

Lex Uniper

Even if not mentioned directly, one could call this regulation, which is expected to be approved within the week, lex Uniper, after Germany’s largest supplier of Russian natural gas, which is on the verge of bankruptcy. What exactly does it provide the new article? “In principle, obstacles to rapid state involvement are removed so that rapid action can be taken,” the relevant article states. “For example, the central government is freed from the obligation to make a takeover offer to all shareholders once it takes control… General meetings will also be able to decide that the government can buy new shares on special terms below the share price “. As the columnist points out, the new regulation will be included in the existing new law on energy security.

“The objective of the planned stabilization measures is the security of supply and the rescue of providers of vital infrastructure,” the article notes. be coordinated with the finance ministry and the chancellery. But a legal claim for stabilization measures is not foreseen. The measures should give the company a chance to continue to exist again.” But the most important thing is that it opens the way for the transfer of the higher energy costs to the consumers, on which according to the information of the newspaper the 3 government partners agree.

The newspaper recalls that maintenance work on the Nord Stream 1 pipeline begins on July 11, and as every year lasts 10 days. So July 22nd is the day of truth, if Russia turns off the gas tap for good, as Berlin fears. The same newspaper also hosts a lengthy article with the title “The double game with Greek shipowners”. In essence, these are accusations that have been hosted by other German media that Greece, Cyprus and Malta, with their tankers, are circumventing the European sanctions on Russian oil.

Simple energy saving “exercises”.

The fear of a possible interruption of the flow of Russian natural gas has led municipalities and communities in Germany to draw up a plan so that it does not get into hot water. The newspaper die Welt in her article she notes that the goal is to save as much natural gas as possible so that the storage tanks are as full as possible in the event that President Putin turns off the tap for good. “The first cities and communities have already taken the first appropriate measures, the general director of the Union of Municipalities and Communities states in the newspaper, by reducing the water temperature in swimming pools, in gyms or in administrative buildings, i.e. nothing to hurt – yet – the citizens” underlines the columnist. “Still other municipalities are turning off public lighting, dimming street lights, closing municipal saunas, eliminating hot water in the changing rooms of sports facilities… For example in Weimar the lights come on later, Cologne wants to reduce the lighting to 70% from 11 in the evening and to 50% from one after midnight. In the future, the maximum temperature in schools will be set at 21 degrees, and the thermostats will even be adjusted accordingly.”

The economic inspectorate of Dusseldorf also refers to the example of Hamburg, where there is a serious debate about a mandatory rationing in hot water. There the local government has wider powers and legal options than municipalities and communities. In another article of hers and in view of the fact that in 90 days the period when the Germans turn on the radiators begins and necessarily an unprecedented period of energy saving, she suggests “tricks” on how this can be done in everyday life. However, the government’s recommendation is “fewer showers and less heating”, reminds the columnist.

Historic decline in German exports

From the front page of the same newspaper, of Welt, another picture of the ominous German reality. For the first time since 1991, Germany’s May trade balance slipped into the red, meaning the world’s fourth-largest economy’s exports are less than its imports. A minus of the order of 1 billion euros. “This time there can be no talk of a consumption boom, but the opposite,” its columnist points out, “consumer sentiment fell to a historic low. The minus in the trade balance in May is not an indication of domestic economic strength but rather a warning about the economic state of the country. Some observers see this as evidence of economic decline in Europe’s largest economy. While Germany depends on imported energy, which is constantly rising in price, exports are reaching their limits in the current environment.”

Looking for the causes, the columnist attributes them not only to the Russian war of aggression in Ukraine, but also to “trade restrictions with other economic blocs (such as China), which lead to congestion of freight traffic across the oceans … the deterioration of the German economy is already being recorded in the stock markets. Among the 100 largest brokerage groups in the world there is only one German company, Linde, which specializes in industrial gases.”

Irini Anastasopoulou

SOURCE: Deutsche Welle