Germany’s energy package ‘must not overlook gas investment needs’ | New

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Commenting on the federal government’s third relief package, Kerstin Andreae, chairwoman of the BDEW board, said that while the relief package will help alleviate the huge energy price spikes caused by the war, the Germany can only invest its way out of this crisis in the medium and long term. The Federal Association for Energy and Water Management BDEW represents more than 1,900 companies.

Andreae said: “We therefore need smart approaches that advance Germany as an economic location and the energy transition. In addition to investments in the massive expansion of renewables, this also includes gas, hydrogen and hybrid power plants, LNG and grid infrastructure, storage technologies and electrolysis systems.

“These investments in the energy transition must not be reduced by an excess of tax on profits. In addition, it should be considered whether a reduction in network charges can also be achieved by using the federal subsidy for the EEG levy account.

The package includes support for “energy-intensive businesses that cannot pass cost increases on to their customers, combined with bonuses for efficiency and replacement investment“, without giving further details.

Andreae added that “speed is the order of the day”.

“Energy suppliers pre-finance energy quantities and, in view of the huge increase in energy prices, need sufficient liquidity support to be able to guarantee this advance payment and thus the security of supply. “, she said.

Alongside a curb on the price of electricity, funded by the profits of energy companies, Chancellor Olaf Scholz announced that he would introduce a revenue cap for electricity producers who do not depend on the currently expensive gas, to the production of electricity.

Carbon dioxide (CO2), which was to be increased by €5 per tonne from 1 January 2023, will now be postponed to 2024, i.e. it will remain at €30 per tonne of CO2.

Natural gas is the second primary energy source in the German energy mix, after oil.

Germany will remain heavily dependent on natural gas imports. It is one of the largest gas markets in Europe, along with the United Kingdom and Italy. More than 90% of natural gas is used as a heating source.

The reduction in gas flows due to the closure of Nord Stream 1 could lead to gas shortages of 9% of national consumption in the second half of 2022, 10% in 2023 and 4% in 2024, which would be worse during the months of winter and would likely fall on businesses, given the legal protections on households, according to the IMF.

Last week, the German government announced it would take delivery of a fifth floating storage and regasification unit (FSRU) in a bid to boost its energy security and reduce dependence on Russian natural gas – but it will not be not commissioned before winter 2023-24. .

After signing a term sheet, Excelerate and ENGIE will work alongside E.ON and Germany to support the development of the FSRU import terminal, which will have a capacity of approximately 5 billion cubic meters (billion cubic meters cubic) of gas per year.

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