The chemical industry is one of the largest gas consumers in Germany – the surcharge could hit them hard.
(Photo: imago images/Arnulf Hettrich)
Dusseldorf Industry is the largest gas consumer in Germany. Correspondingly high costs are now being faced by companies with the gas surcharge. For the energy-intensive industry alone, the so-called “balanced price adjustment” means additional costs of more than 5.3 billion euros, the industry association EID explained on Monday. For each job, there is an additional burden of almost 6300 euros.
The Trading Hub Europe joint venture announced the amount of the gas surcharge on Monday. From October 1, both household and business customers will have to pay 2.419 cents more per kilowatt hour (kWh).
“For months, the pressure on companies has been increasing due to the drastic price increases for electricity, gas and other energy sources,” criticizes the EID. From the steel industry to the automotive industry to the packaging industry, the energy-intensive industries in Germany consume 220 terawatt hours of natural gas per year.
The significant energy price increases for companies compared to the previous year have already resulted in additional costs running into the billions. The gas levy that has now been determined is added to this.
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According to the industry association VCI, the chemical-pharmaceutical industry in Germany alone calculates annual additional costs of more than three billion euros as a result of the levy. Due to the multiple burdens from high gas and electricity prices as well as expensive raw materials, many companies reached their breaking point.
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The plastics manufacturer Covestro assumes an additional burden in the low to mid three-digit million euro range for the period of the levy. For the current year 2022, the Leverkusen-based company expects an increase in global energy costs to up to 2.2 billion euros without a surcharge – more than three times as much as in 2020. “Overall, the high energy costs are jeopardizing the competitiveness of Germany as a business location,” warns Covestro.
According to the steel industry, they face additional costs of around 500 million euros every year. “The gas levy increases the cost pressure that already exists due to the extreme price increases on the energy markets,” said Hans Jürgen Kerkhoff, President of the German Steel Federation. Natural gas is required in production to generate process heat.
The record prices on the stock exchanges are to blame for the already high energy prices. As early as autumn of last year, the prices for coal, oil and gas had risen after the global lockdowns had eased with a sharp rise in demand.
Since the outbreak of the Ukraine war and the lack of Russian gas volumes, supply on the world market has once again become dramatically scarce. A megawatt hour of natural gas currently costs 206 euros on the Dutch TTF exchange for September. A year ago, the prices were just under 25 euros.
Building becomes even more expensive
375
Million Euros
The Federal Association for Building Materials expects additional costs from the gas levy.
For individual companies, the surcharge now adds several million euros to the already high bill, depending on gas consumption. Take the paper industry as an example: According to the umbrella organization of the German paper industry, a factory uses an average of 170 gigawatt hours of gas per year. With an allocation of 2.419 cents, the additional burden is around 4.1 million euros.
In order to maintain competitiveness and jobs, there must be an upper limit for companies with particularly high energy consumption, demands EID boss Jörg Rothermel. The aid should then come from the federal budget so as not to burden private households even more.
“The announced gas surcharge of 2.419 cents per kWh means annual additional costs of around 375 million euros for the building materials, stone and earth industry,” calculates Matthias Frederichs, head of the Federal Association for Building Materials. He also calls for relief mechanisms “to stabilize industrial competitiveness” from the federal government.
Holger Loesch, Deputy General Manager of the Federation of German Industries (BDI), calls for the levy to be extended beyond 2024. The chemical association VCI also wants to achieve this in order to avoid overburdening the industry in the short term. The VCI advocates keeping the gas levy as low as possible through state subsidies. They could be counter-financed, for example, by additional revenue from sales tax, which arises due to the high energy prices.
Collaboration: Kevin Knitterscheidt
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