Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Germany unveils €65B in energy cost relief, vows to cap prices

Germany unveils €65B in energy cost relief, vows to cap prices

Chancellor Scholz says package includes plans to collect excess profits from some energy producers.

The German government on Sunday announced a €65 billion relief package to cushion citizens and companies from skyrocketing energy costs while also vowing to reform the energy market to collect excess profits and cap prices.

"We will get through this winter," Chancellor Olaf Scholz said during a press conference as he announced various support measures as well as an extension of Germany's hugely popular state-subsidized €9 transport ticket.

Crucially, Scholz also said that his 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," the Social Democratic chancellor told reporters. "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."

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.

Scholz said that "the many, many billions" of excess profits that the state would collect from such energy providers would be used to finance relief measures and introduce "a price cap for those in the electricity market who do not have to pay the high gas prices." The European Commission is already working on plans to propose such a price cap at the European level.

Scholz's Finance Minister Christian Lindner, from the liberal Free Democratic Party (FDP), had previously raised opposition toward introducing an excess-profit tax in Germany; such a tax already has been announced in the U.K. and Italy. On Sunday, Lindner — speaking next to the chancellor in Berlin — backed the proposed measures, stressing that this was not a tax in the classical sense but rather an intervention in the framework of energy market rules.

Scholz said his government would seek to implement the energy price cap in accordance with European rules, if they could be quickly agreed by EU countries, "or by implementing them on a national level."


Relief for students and pensioners


When it comes to the relief measures for citizens, Scholz said that pensioners would receive a €300 easing and students €200. He also vowed to extend state-paid housing allowances from the current total of 700,000 recipients to about 2 million recipients. The new relief package, which comes on top of two previous packages that together amounted to €30 billion, also cuts social security contributions for people with a monthly income below €2,000 and increases child allowances.

Another cornerstone of the package is a permanent extension of the €9 transport ticket, which had allowed citizens this summer to travel for one month on all buses, trams, metros and regional trains nationwide, but expired at the end of August. Although Germany's 16 federal states still need to agree to their share of the financing, the price of the new monthly ticket will probably be between €49 and €69.

"It is a matter of negotiation between the federal government and the states," said Omid Nouripour, the co-leader of the Green party, which rules in a coalition with Scholz's Social Democrats and Lindner's FDP. "We hope that we will very soon be able to agree on a Germany ticket with a price around €49," Nouripour added.

A cornerstone of the package is a permanent extension of the €9 transport ticket which had expired at the end of August


Germany's main industry lobby BDI criticized the relief package, saying it had "significant shortcomings and gaps" because it largely focused on private households and was offering too little support for companies that are also suffering from high energy prices.

"The industry expects the government to better include the interests and practical needs of companies in its ongoing crisis management," BDI President Siegfried Russwurm said in a statement.

The full paper detailing the German relief measures, which were agreed on by the three coalition parties overnight.

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Hungarian Prime Minister Viktor Orbán stated that Hungary will not adopt the euro because the European Union is falling apart.
Mayor in western Germany in intensive care after stabbing
Australian government pays Deloitte nearly half a million dollars for a report built on fabricated quotes, fake citations, and AI-generated nonsense.
BYD’s UK Sales Soar Nearly Nine-Fold, Making Britain Its Biggest Market Outside China
Latvia to Bar Tourist and Occasional Buses to Russia and Belarus Until 2026
Wave of Complaints Against Apple Over iPhone 17 Pro’s Scratch Sensitivity
Munich Airport Reopens After Second Drone Shutdown
Pro Europe and Anti-War Babiš Poised to Return to Power After Czech Parliamentary Vote
Sean ‘Diddy’ Combs Sentenced to Fifty Months in Prison Following Prostitution Conviction
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Russian Research Vessel 'Yantar' Tracked Mapping Europe’s Subsea Cables, Raising Security Alarms
Global Cruise Industry Posts Dramatic Comeback with 34.6 Million Passengers in 2024
U.S. Demands Brussels Scrutinize Digital Rules to Prevent Bias Against American Tech
Private Equity’s Fundraising Surge Triggers Concern of European Market Shake-Out
Tokyo’s Jimbōchō Named World’s Coolest Neighbourhood for 2025
European Officials Fear Trump May Shift Blame for Ukraine War onto EU
The Personality Rights Challenge in India’s AI Era
Italy Considers Freezing Retirement Age at 67 to Avert Scheduled Hike
Italian City to Impose Tax on Visiting Dogs Starting in 2026
Study Finds No Safe Level of Alcohol for Dementia Risk
Trump Says Ukraine Can Fully Restore Borders with NATO Backing
Europe Signals Stronger Support for Taiwan at Major Taipei Defence Show
Germany Weighs Excluding France from Key European Fighter Jet Programme
Cyberattack Disrupts Check-in and Boarding Systems at Major European Airports
Björn Borg Breaks Silence: Memoir Reveals Addiction, Shame and Cancer Battle
When Extremism Hijacks Idealism: How the Baader-Meinhof Gang Emerged and Fell
JWST Data Brings TRAPPIST-1e Closer to Earth-Like Habitability
Trump Orders $100,000 Fee on H-1B Visas and Launches ‘Gold Card’ Immigration Pathway
France’s Looming Budget Crisis and Political Fracture Raise Fears of Becoming Europe’s “Sick Man”
Three Russian MiG-31 Jets Breach Estonian Airspace in ‘Unprecedentedly Brazen’ NATO Incident
European manufacturers against ban on polluting cars: "The industry may collapse"
Turkish car manufacturer Togg Enters German Market with 5-Star Electric Sedan and SUV to Challenge European EV Brands
Christian Brueckner Released from German Prison after Serving Unrelated Sentence
World’s Longest Direct Flight China Eastern to Launch 29-Hour Shanghai–Buenos Aires Direct Flight via Auckland in December
New OpenAI Study Finds Majority of ChatGPT Use Is Personal, Not Professional
The conservative right spreads westward: a huge achievement for 'Alternative for Germany' in local elections
Pope Leo Warns of Societal Crisis Over Mega-CEO Pay, Citing Tesla’s Proposed Trillion-Dollar Package
Poland Green-Lights NATO Deployment in Response to Major Russian Drone Incursion
U.S. and China Agree on Framework to Shift TikTok to American Ownership
Le Pen Tightens the Pressure on Macron as France Edges Toward Political Breakdown
Czech Republic signs €1.34 billion contract for Leopard 2A8 main battle tanks with delivery from 2028
Penske Media Sues Google Over “AI Overviews,” Claiming It Uses Journalism Without Consent and Destroys Traffic
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
One in Three Europeans Now Uses TikTok, According to the Chinese Tech Giant
Could AI Nursing Robots Help Healthcare Staffing Shortages?
NATO Deploys ‘Eastern Sentry’ After Russian Drones Violate Polish Airspace
The New Life of Novak Djokovic
German police raid AfD lawmaker’s offices in inquiry over Chinese payments
Volkswagen launches aggressive strategy to fend off Chinese challenge in Europe’s EV market
France Erupts in Mass ‘Block Everything’ Protests on New PM’s First Day
×