Latest news with #electricitytax
Reuters
a day ago
- Business
- Reuters
Mood in Germany's chemical industry brightens on power subsidy plan, Ifo says
July 1 (Reuters) - Expectations in Germany's chemical industry improved significantly in June as companies pin their hopes on a planned reduction in electricity tax for industry, according to a survey published on Tuesday. The Ifo economic expectations indicator for the sector entered positive territory in June, reaching 9.5 points, its highest in three and a half years, from -5.4 points in May. The German government plans to cut electricity tax for selected sectors, limiting its planned relief to industry, agriculture and forestry. The plans have prompted criticism from representatives from the retail, industrial, and energy sectors, who warn it could distort competition and have limited impact. Electricity prices in Germany are among the highest in the world, ranking fifth globally in the first quarter of the year with an average of 38 euro cents per kilowatt-hour. "However, the increased confidence is hardly reflected so far in the current business situation of many companies," Ifo said, adding that the order backlog remains extremely low. Some companies are benefiting from lower raw material costs and the first signs of an upturn in demand on international markets, Ifo said, while also flagging the United States' protectionist tariff policy, high location costs and geopolitical uncertainty as weighing on the sector's recovery. "In this situation, the state investments decided by the German government are providing urgently needed impetus," Ifo industry analyst Anna Wolf said.
Reuters
7 days ago
- Business
- Reuters
Germany's retail, industrial, energy sectors criticise power subsidy plan
BERLIN, June 25 (Reuters) - Germany's plan to cut electricity tax for selected sectors was criticised on Wednesday, as representatives from the retail, industrial, and energy sectors warned it could distort competition and have limited impact. Electricity prices in Germany are among the highest in the world, ranking fifth globally in the first quarter of the year with an average of 38 euro cents per kilowatt-hour. Earlier this year, Germany's ruling coalition of conservatives and Social Democrats agreed to cut electricity tax to the European minimum for all consumers. But the Finance Ministry framework budget for 2026 introduced on Tuesday limited the planned relief to industry, agriculture and forestry, excluding many companies and consumers, citing financial difficulties. The dispute between the SPD-led finance ministry and the conservative CDU/CSU over the scope of the subsidies is one of the first since the two parties officially took office last month. "With such a breach of the coalition agreement, the government is squandering the trust of the trade and tearing the rug out from under companies," Alexander von Preen, head of HDE trade association, said. Sepp Mueller, the deputy leader of the conservative CDU/CSU parliamentary group, said reducing electricity costs for everyone remained the party's goal. "We now need to quickly discuss when we can implement this," Mueller told Reuters. Germany's Chamber of Industry and Commerce (DIHK) said the cuts were a slap in the face for many companies as the government had sold the scheme as an immediate measure. "No one understands why, despite the planned record debt, this already quite small but very important relief should not be possible," DIHK President Peter Adrian said. On Wednesday, Economy Minister Katherina Reiche said Germany will present a concrete concept for an industrial electricity price after the European Union introduced a new state aid framework that would allow such subsidies. Germany's utilities lobby BDEW also warned of market distortions and a slowdown in the expansion of renewable energy. BDI industry association said the narrow scope and numerous restrictions of the measure leave too little room to lower electricity prices to an internationally competitive level. The ZDH Central Association of Skilled Crafts said an industrial electricity price would distort competition to the detriment of small and medium-sized craft businesses, which must co-finance this relief.
