Germany and Finland clash over billion-dollar rescue energy group Uniper

09 July 2022
today at
14:42

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The German government wants the Finnish public company Fortum, as majority shareholder of Uniper, to pay for the rescue of the German energy giant. The Finnish government thinks otherwise.

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The German government is looking at how it can keep the company afloat through a capital injection, but the German Minister of Economy Robert Habeck indicates that Germany should not be the only one to put money on the table. Uniper is 78 percent owned by the Finnish government-controlled energy company Fortum. In a radio interview, Habeck emphasized on Saturday that the majority shareholder will have to do its part.

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“The company belongs to someone who is solvent and who can provide support,” said Habeck, who is also Energy Secretary. ‘It is correct to consider models in which the owners also make an obligation.’

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Diplomatic high voltage

The case is causing diplomatic tension, the Reuters news agency knows, especially after a phone call from a high-ranking German minister was refused from the Fortum top. Fortum does not seem to intend to solve the German supply problem and emphasizes that it has already provided EUR 8 billion in loans and guarantees to Uniper.

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Fortum itself is aiming for Berlin to become the owner of those Uniper parts that are critical to the German gas supply. “The German companies that guarantee supplies should be owned by the federal state that has the necessary strong creditworthiness,” Fortum CEO Markus Rauram said in a written response.

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We urgently ask that the system-critical Uniper companies be shielded and rescued by the German state.

Titti Tuppurainen

Finnish Minister of European Affairs

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Finland, whose economy is only a 13th that of Germany, faces a major challenge. “The rescue of Uniper is a matter of European interest,” said Tytti Tuppurainen, Finland’s minister of European affairs. “We urgently ask that the system-critical Uniper companies be shielded and rescued by the German state.”

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Domino-effect

Uniper is Germany’s largest importer of gas and the largest energy company to date that is on the brink of collapse due to the energy crisis in Europe. Habeck already warned of a Lehmans Brothers scenario, where one player falls over a can cause domino effect with a shock wave throughout the entire energy market. By analogy with the banking crisis, Uniper is considered ‘too big to fail’ and Habeck has already indicated that it will not allow ‘such a systemically important company to go bankrupt’.

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Germans shower for an average of 10 minutes. I think even five minutes is too long.

Robert Habeck

German Minister of Economy

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Germany has 15 billion euros in public funds reserved to be able to fill the stocks with a view to next winter, despite the reduced Russian supply. Habeck warned that if gas prices continue to rise, that amount will not be enough.

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The green leader therefore calls on the Germans to be frugal. “Germans shower for an average of 10 minutes,” he said. “I think even five minutes is too long.” Habeck is also looking at a relaxation of the obligation that still applies to companies to run the heating in the workplace for a large part of the day.

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Germany and Finland clash over billion-dollar rescue energy group Uniper

Diplomatic high voltage

Domino-effect

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