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    Berlin mulls demand-side gas levy: press


State charges could be used, rather than allowing utilities to pass prices onto consumers.

by: Callum Cyrus

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NGW News Alert, Natural Gas & LNG News, Europe, News By Country, Germany

Berlin mulls demand-side gas levy: press

Berlin could introduce a new charge on German gas consumers to help offset rising import costs due to tightening markets and diminished deliveries from Russia's Gazprom.

Germany's Bundestag is expected to vote on the new law on July 8, the newswire said, citing government and industry sources. The measure would be an alternative to allowing energy utilities to directly pass wholesale prices onto customers.

The law states only "reasonable" costs should be passed on, which creates some room for interpretation, and it is unclear how this would affect fixed-price billing contracts. The direct government levy would still allow Berlin to bring in industry price adjustments if there is "significant disruption" to gas imports.

Gas flows through the Russia-Germany Nord Stream pipeline have been as much as 60% lower in recent weeks. The operator Gazprom says Western sanctions have delayed a repair job at one of the route's compressor stations.

Tighter suppliers have sparked fears Germany will face even higher gas prices. Reuters reports around €1bn ($1bn) will be required to cover the additional cost to German utilities, an amount the proposed levy could finance.

The news came as Germany's Uniper admitted it could need a government bailout, having previously said Gazprom was supplying 25% less gas than its contract. Uniper has cancelled its 2022 outlook due to Gazprom's curtailments.

Berlin is now anxious to get its contingency plans locked down as Gazprom will take Nord Stream offline entirely on July 11 for 10 days of planned maintenance. Reuters indicates the outage could even be extended beyond the envisaged July 21 deadline.