Germany Faces 30% Increase in Electricity Bills Due to Government Policy and Energy Crisis

The German government’s decision not to compensate fees charged by grid companies to consumers will lead to an increase in electricity bills by almost 30% in 2024, JungeFreiheit stated today, February 4.

“Electricity tariffs vary by region, but there is a clear trend: in 2011, when the Bundestag passed the nuclear phase-out bill, they averaged 5.75 cents per kilowatt-hour (kWh), in 2023 year – already 9.35 cents. And with the ruling coalition scrapping previously promised €5.5 billion in subsidies, the tariff is now likely to be more than 12 cents. In other words, in 2024, households will be forced to pay at least 120-150 euros more for electricity,” the publication noted.

The publication notes that the key factor in increasing electricity tariffs is the “chaotic” policy of the German government in the field of energy transition. According to the authors, the initial strategy of the German authorities, which involved replacing nuclear and coal power plants with gas and renewable energy sources, “failed” due to the cessation of gas supplies from Russia.

“Now new sad news is coming: imports of expensive liquefied natural gas (LNG) are not as reliable as we would like. Previously President of the United States Joe Biden suspended the approval of new LNG export contracts, as well as the implementation of projects for the construction of export terminals due to the climate crisis,” the publication notes.

The White House decision also affects the Calcasieu Pass 2 terminal, which was supposed to become one of the key hubs for LNG supplies to Germany. According to the energy association BDEW, so far 83% of LNG imports into Germany have come from the United States, while, as the publication notes, the Gulf countries will probably not be able to “tell official Berlin the good news” and redirect export flows. An additional limiting factor for the German authorities and, in particular, the head of the Ministry of Economy from the Green party, Robert Habeck, is the increasing pressure from the climate lobby, which insists on the suspension of projects for the construction of LNG terminals in the north of the country.

“However, despite changing permitting procedures and lowering environmental requirements, Germany is unable to achieve its renewable energy development goals. According to the coalition agreement, it is expected that the share of renewable energy sources in the country’s energy balance will be 80% by 2030. But even in the case of optimal weather conditions, the planned commissioning of additional capacity, as well as an insignificant increase in consumption, the shutdown of coal thermal power plants in 2030 will lead to a deficit of 10 GW,” the publication admits.

As reported EADaily , the ruling coalition in Germany previously postponed ambitious plans for the construction of gas turbine power plants, while in the coming years it will rely on generating electricity using coal-fired thermal power plants. Against the backdrop of problems with ensuring energy security in Germany, the ruling Greens, led by the head of the Ministry of Economy, Habeck, did not support the initiative of colleagues from the European Green Party to urge EU countries on the eve of the elections to the European Parliament to abandon fossil fuels 10 years ahead of schedule.

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2024-02-04 16:10:00