Municipal utilities have to buy natural gas more and more expensive on the market, but cannot pass the prices on to their customers. Many companies are overwhelmed by the balancing act. The state should help now. But he doesn’t always want to.
In Munich, people will only sweat outside from August. The municipal utilities of the Bavarian state capital recently announced that they would close the ten saunas they operate in the city area starting this week. In addition, the water temperatures in swimming and outdoor pools are slightly reduced. It is important to save. Less gas consumption means less expenditure for the municipal utility.
350 kilometers southwest, in Bad Säckingen on the Swiss border, they are already past the point at which saving would help. In the small town on the Upper Rhine, the city council decided last week on an 11 million euro aid package for the local public utilities. A private shareholder adds another 4 million. The Bad Säckinger Stadtwerke are in an enormous imbalance since gas prices have risen.
Nowhere else in Germany is it as bad as there, but no one underestimates the seriousness of the situation with most municipal suppliers. Municipal utilities are in a special situation: They have to ensure the basic supply of the population, which also means that they have to offer prices that this population can pay, regardless of household income.
That is why municipal utilities cannot increase their tariffs at will, and certainly not as much as they would have to in order to compensate for the current gas prices. A kilowatt hour at the Dutch trading point TTF, which is also crucial for Germany, now costs 198 euros, 370 percent more than a year ago. The throttling of deliveries by Nord Stream 1 has recently caused the price to rise sharply again.
The extent to which municipal utilities are affected depends on many factors. Anyone who has concluded long-term supply contracts with gas producers is now paying even lower prices than at the TTF. But the more gas Stadtwerke speculatively buy there, the more threatening the situation is for them. In the negative example of Bad Säckingen, the proportion of natural gas purchased at short notice was 30 percent.
In other cases, it also plays a role where municipal utilities get their gas from. Anyone who has concluded supply contracts with Uniper, for example, is more dependent on Russian gas, which is currently hardly flowing, and has to buy a lot on the wholesale market. If you get your gas from Norway or the Netherlands anyway, you can take a more relaxed view of the situation. Most municipal utilities have a mix of countries of origin, making it difficult to predict which municipalities are more affected than others.
But they all have in common that they prepare for emergencies. If the third stage of the gas emergency plan were to be announced by the federal government in autumn, the public utilities would have to start turning off the gas for certain customers. First this hits the heating gas for industrial customers, then the production gas. Private households are considered protected consumers to the last. By the time the faucet is turned off here, gas supplies from abroad would have to stop completely.
The municipal utilities prepare their own emergency plans to determine who will be cut off the gas, when and under what circumstances, and how the necessary pressure in the gas lines can be maintained. It is clear that the winter will be financially difficult for many. Even those who are still buying cheap gas through long-term contracts have to fill up their gas storage tanks, which is usually only possible with expensive wholesale gas.
Accordingly, the calls for state aid are getting louder, especially after the federal government recently invested in Uniper to save the group from bankruptcy. The German Association of Cities wants municipal utilities to have a protective shield. The financial aid should include guarantees, loans and an insolvency moratorium. Federal Consumer Protection Minister Steffi Lemke (Greens) also wants the latter for consumers who can no longer pay the high gas bills. Nobody should be turned off the gas because he or she cannot pay for it.
The federal government is still blocking such a protective shield for public utilities. Federal Minister of Economics Robert Habeck (Greens) sees the responsibility for this in the federal states and municipalities. In NRW there should actually be such a protective shield soon. Baden-Württemberg and Saxony also want such an instrument in their state, but do not want to pay for it. They’re asking for money from the federal government.
Follow the author on Facebook
Follow the author on Twitter
