The German government will have the power to take stakes in utilities and impose emergency levies on consumers under proposed legal changes now being debated, three sources told Reuters, as Berlin works to tighten energy security.
The Minister of the Economy, Robert Habeck, has recently warned of the possibility of a “Lehman effect”, as providers face increased costs to meet their obligations to customers.
Representatives have been talking to Uniper, Germany’s biggest buyer of Russian gas, about a bailout, and the sources said Berlin wants to make sure similar bailout measures are available to other companies if needed.
Uniper said last week that it was discussing possible guarantees, obtaining credit facilities or even the state taking an equity stake.
The sources told Reuters the government might take a stake in Uniper as a last resort, and was preparing possible rescue measures for similar companies through amendments to its energy security law. Uniper declined to immediately comment.
Amendments to the law are currently being discussed among government ministries and could be submitted to parliament on Friday.
They could also allow the government to quickly impose a special rate on consumers as a means of fairly passing on rising energy costs, the government sources said.
A potential bailout of Uniper could be modeled after the bailout of Lufthansa, which was saved from bankruptcy during the coronavirus pandemic with a 9 billion euro ($9.4 billion) aid package, a German government source said.
In the rescue of Lufthansa, the State took a 20% stake in the airline through an Economic Stabilization Fund, but without being able to exercise the voting rights of the shareholders.
The airline was not allowed to acquire other companies until 75% of the state aid had been repaid, and its shareholders and managers could not benefit from taxpayers’ money, which meant dividend and bonus payments were put on hold.
Decades after deregulating their energy markets, governments across Europe are stepping in to prop up sinking utilities in the face of skyrocketing prices, while protecting consumers from soaring costs.
To try to shield consumers from rising energy bills, governments have also resorted to windfall taxes on oil and gas companies, subsidies and rebates.
Source: Gestion
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