[Skybird]

FOCUS summarises well what I am complainign about all the time in the German management of the gas crisis. Maximum incompetence at work. And plenty of ideology. BTW, after Quatar (zero deal) and Norway (small deal increase) now Canada had to let down the Germans' and their hopes to drastically increase gas delivery rapidly. All that the German got from Trudeau is long-termed intentions declared in a paper. I know there were plenty of smiles exchanged and plenty of friendly words, but thats what it comes down to: a declaration of intention for - of course: green - hydrogen being produced and shipped at some years away in the future. Insiders say since the production sites and shipping facilities and transpüortaiton capcities needs to b e build first. we are talking about a future 5 to 10 years away - minimum.

Also, the Germans invest again into making themselves exclusively dependent on others. Everythign is better, in German eyes, than to produce the power right where it is needed, which from a standppoint of physics and economics by far would make the most sense. Its an giant energy waste just to get some net energy in return. How very green!


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Three gas mishaps by our government stun even experts

The desired effects of the gas levy are neutralized by the reduction in VAT. The revenue from the instrument ends up with the wrong people. At the same time, ever scarcer gas is being used to generate electricity in unprecedented quantities. What is going wrong in the traffic light coalition?

The traffic light coalition in Berlin no longer has a grip on the issue of gas supply in Germany. There's no other way to explain the string of mishaps and inconsistencies that gas customers are currently having to pay for. This is the verdict of many economists following last week's numerous decisions on the subject. The political opposition continues: Union leader Friedrich Merz speaks of "chaos with announcement".

In fact, the traffic light government has made three mistakes that show it is not using the right instruments to deal with the crisis.

Mistake number 1: Gas surcharge up, VAT down

Mistake number one is the combination of a gas levy, which Economics Minister Robert Habeck announced as unavoidable last Monday, and the reduction of VAT to seven percent for gas, which Chancellor Olaf Scholz promised two days later.

So gas is first made more expensive, which encourages consumers to save gas. Then it is made cheaper again and the effect fizzles out. Economists are perplexed by so much actionism in the German government: Stefan Kooths, vice president and head of the Kiel Institute for the World Economy (IfW), notes that the VAT decision "dilutes an essential desired purpose of the gas levy: to save gas."

Marcel Fratzscher, president of the German Institute for Economic Research (DIW), thinks that the reduction of the value-added tax for low-income earners is better than nothing, but still far too little. "Much better are direct transfer payments, such as an energy allowance, of 100 euros per month & person for households with medium and low incomes," Fratzscher writes.

Jens Südekum, professor of international economics and member of the Scientific Advisory Board of the German Federal Ministry for Economic Affairs and Energy, advocates letting price signals take full effect and cushioning them with socially graduated income transfers. And Ifo President Clemens Fuest sees one main problem with the measure: private households would be relieved, but companies would be burdened because they would only pass on the VAT to their customers. "I'm not sure that's what the government intended," he wrote on Twitter.

Glitch number 2: The billions from the gas levy flow to the wrong people

In the future, German gas customers will pay billions of euros with their gas levy to domestic and foreign corporations that are doing just fine without this revenue. This emerges from a report by Trading Hub Europe, the company that ultimately organizes the levy on behalf of the Ministry of Economics.

Trading Hub published a list of eleven companies on Monday. In addition to the Düsseldorf-based utility Uniper, which is already known as a beneficiary, is financially shaken and is already being supported by the state, for example, the Baden-Württemberg-based EnBW, the Austrian OMV and the Swiss Axpo are among the likely recipients of the money.

EnBW expects to make billions in profits this year despite rising energy costs, recently increased its dividend and is enjoying a share price that has risen nearly 30 percent since the beginning of the year. Nevertheless, its subsidiary VNG, a gas trading company based in Leipzig, has applied for money from the gas levy.

Another example is the largest Austrian group listed on the stock exchange: OMV. As an energy supplier and petroleum company, OMV has benefited greatly from high oil and gas prices, more than doubling sales and profits in the first half of the year.

Swiss energy supplier Axpo also wants money from German gas customers. It is currently suffering a little from the energy crisis, but at a high level. The half-year figures were not as brilliant as in the past, but a profit of around half a billion Swiss francs remained at last.

Group CEO Christoph Brand speaks of a "good result in stormy times. To keep it that way, he is apparently now tapping German gas customers. Habeck had described the gas levy as "the fairest way to distribute the additional costs among the population." The fact that the money is now going to high-earning corporations contradicts this assessment.

Breakdown number 3: Gas used en masse to generate electricity

In May and July, more gas was burned in Germany to generate electricity than ever before. This admission by the Federal Network Agency, which is subordinate to Economics Minister Habeck, must be seen as a mockery by people who will soon be spending hundreds of euros extra for a warm apartment. They are being told that gas has become a scarce commodity. One that has to be bought at a high price, that will continue to be indispensable for heat generation for a long time to come, and that people urgently need for heating and industry for firing and production.

That's why gas storage levels are currently published somewhere almost daily, just as Corona case numbers were in previous years. The message behind it: The weal and woe of industry and private households depends on it in winter.

If more electricity is needed than can be supplied by renewable energy, coal and oil-fired power plants, but gas is needed elsewhere, then the nuclear power plants that reliably produce electricity should continue to operate. However, the Greens in the traffic light government do not want to know anything about this. What is clear is that the energy debate is ideological.