The German federal government has announced EUR 65 billion comprehensive package of measures to contain the energy price crisis on 29 September. German Chancellor Mr Olaf Scholz said “We will get through this winter. The government would crack down on energy providers that are making excess profits amid the high energy prices that have been largely caused by Russia's war against Ukraine as well as Moscow's reduction of gas exports to Europe. There are excess profits by some producers who can simply take advantage of the situation that the very expensive price of gas determines the price of electricity, and that therefore make a lot of money. We are firmly determined to change the market rules in such a way that such windfall profits no longer occur, or that they are skimmed off.”German Steel Federation W Stahl President Mr Hans Jürgen Kerkhoff said “The announced brake on energy prices, including industry, is an important step in the right direction. The steel industry and the steel-based value chains face intense international competition. They are under existential pressure due to the exploding prices for electricity and gas. Now it's all about speed and effectiveness. It is about bridging the crisis and preventing serious damage to the industrial base.”He also said “The skyrocketing energy prices are endangering Germany as a steel location and the steel-based value chains based on it. The current energy crisis must be prevented from causing permanent damage to the industrial base, with all the consequences for value chains, jobs and investments. Rapid action to bridge the crisis is urgently needed. We therefore appeal to the Council of Energy Ministers to create solutions, particularly for energy-intensive industries such as the steel industry. Now it is important to take very fast-acting measures that can immediately bring electricity and gas prices to an internationally competitive level.”While gas is only partly used in Germany to produce energy, the current market design has caused the high gas prices to jack up general energy prices, meaning that providers who produce energy from other sources such as wind, solar or coal are making huge profits. Extrapolated for the year as a whole, the additional costs for electricity and gas in steel companies in Germany are currently around 10 billion euros compared to the beginning of the previous year. This is around a quarter of the turnover that the industry has achieved on average in recent years.
The German federal government has announced EUR 65 billion comprehensive package of measures to contain the energy price crisis on 29 September. German Chancellor Mr Olaf Scholz said “We will get through this winter. The government would crack down on energy providers that are making excess profits amid the high energy prices that have been largely caused by Russia's war against Ukraine as well as Moscow's reduction of gas exports to Europe. There are excess profits by some producers who can simply take advantage of the situation that the very expensive price of gas determines the price of electricity, and that therefore make a lot of money. We are firmly determined to change the market rules in such a way that such windfall profits no longer occur, or that they are skimmed off.”German Steel Federation W Stahl President Mr Hans Jürgen Kerkhoff said “The announced brake on energy prices, including industry, is an important step in the right direction. The steel industry and the steel-based value chains face intense international competition. They are under existential pressure due to the exploding prices for electricity and gas. Now it's all about speed and effectiveness. It is about bridging the crisis and preventing serious damage to the industrial base.”He also said “The skyrocketing energy prices are endangering Germany as a steel location and the steel-based value chains based on it. The current energy crisis must be prevented from causing permanent damage to the industrial base, with all the consequences for value chains, jobs and investments. Rapid action to bridge the crisis is urgently needed. We therefore appeal to the Council of Energy Ministers to create solutions, particularly for energy-intensive industries such as the steel industry. Now it is important to take very fast-acting measures that can immediately bring electricity and gas prices to an internationally competitive level.”While gas is only partly used in Germany to produce energy, the current market design has caused the high gas prices to jack up general energy prices, meaning that providers who produce energy from other sources such as wind, solar or coal are making huge profits. Extrapolated for the year as a whole, the additional costs for electricity and gas in steel companies in Germany are currently around 10 billion euros compared to the beginning of the previous year. This is around a quarter of the turnover that the industry has achieved on average in recent years.
