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Thursday, May 19, 2022

Energy policy: something for everyone

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The traffic light has decided to reduce energy costs. Who gets how much money, how fair is that, and who prevailed? The most important answers

For days, stoplight coalition partners had been arguing about how best to ease the burden on citizens in the face of rising energy prices. After eleven hours of negotiations, negotiators have now reached a compromise estimated to cost €15 billion. And in the end everyone gets something.

What new reliefs have been decided?

All employees, regardless of whether they are employed or self-employed, receive a one-time “energy price flat rate” payment of 300 euros. It is not yet clear whether this also applies to pensioners. However, income taxes are deducted from the 300 euros, which means that only those who do not pay taxes can keep the lump sum in full. And those who earn a lot are allowed to keep less.

For families there is 100 euros per child, the amount is deducted from the allowance per child. High earning parents benefit less from this.

Recipients of social assistance will receive a flat rate of 100 euros per person, in addition to the 100 euros they were promised in the first energy package.

The price of fuel will be reduced for three months by reducing the energy tax on fuel. According to Finance Minister Christian Lindner, this should make petrol 30 cents cheaper per liter and diesel 14 cents cheaper. The government wants to make sure that corporations actually have to pass this reduction on to consumers. To control this, the market transparency office of the Federal Cartel Office will be strengthened.

Drivers and non-drivers now have the option of using buses and trains on the local public transport network for nine euros a month. It is not yet clear if this also applies to those who already have much more expensive annual tickets or a subscription to monthly tickets. Like the fuel price reduction, the offer is valid for three months.

What is planned to increase energy efficiency?

The coalition not only wants to cushion prices, but also to ensure that less energy is consumed in the medium term. For this reason, the 55 energy efficiency standard should apply to all new buildings from 2023. From 2024, “if possible”, all newly installed heating systems should be powered by 65 percent renewable energy . The word “if possible” indicates that the exceptions must remain possible. The government wants to provide financial support to replace heating systems that are at least 20 years old. The newspaper also speaks of a “heat pump offensive” in industry, commerce and homes.

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