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Global Economy

What to do against rising energy prices?

The price shock is noticeable: whether at the pump, in electricity costs or when heating. Many consumers are painfully aware that energy has become significantly more expensive. According to the Federal Statistical Office, the prices for heating oil and motor fuels have increased by more than a third within a year.

The Union, as the largest opposition faction, is now putting the pressure on. The federal government must take countermeasures, says the energy expert of the CDU, Andreas Jung: "The state has additional income from increased energy prices, and this must now be returned to the citizens. And that's why we need more relief than what the traffic light has brought on the way so far . The state must not profit from increased energy prices."

Heating subsidy to help those in need

In fact, the state benefits via VAT when energy prices rise for consumers due to global markets. In addition, the CO2 tax is now being increased year after year in order to promote climate protection. Conversely, the EEG surcharge was reduced at the beginning of the year. However, this has hardly been able to dampen the price increase.

The coalition knows that energy prices are causing resentment in many places. However, discussions are still ongoing about specific relief. The federal government has already launched a one-time heating subsidy for the needy. Around two million recipients of housing benefit or BAföG should benefit from this, as deputy government spokeswoman Christiane Hoffmann said this week: "The federal government is careful that the relief, which should also be noticeable due to the increased prices, does not happen with the watering can , but is shaped socially."

burden on average earners

The problem with this is that the increased energy prices are affecting practically all households and companies. And for normal earners, that's a lot of money. The coalition parties are therefore considering completely abolishing the EEG surcharge more quickly than previously planned. Many people could benefit from this – provided that the energy suppliers pass the savings on to their customers.

Finance Minister Christian Lindner, FDP, can also imagine an increase in the commuter allowance. This would particularly benefit those who work long distances to work. However, this is met with criticism from the Greens. In principle, they regard the commuter allowance as an environmentally harmful subsidy.

"New form of business"

The lump sum represents the fundamental dilemma of the coalition: in the short term, they want to provide relief, but in the medium term they want to make fossil energy consumption more expensive through political measures – in favor of climate protection and with the aim of pushing the expansion of renewable energies. Economics Minister Robert Habeck from the Greens has therefore been emphasizing for weeks that he also sees price developments as an opportunity to switch more quickly.

"In truth, it is also a challenge that can make us grow – literally, the prosperity and wealth of this country, including economic wealth: to make us more independent of raw material imports through a new form of business and CO2 – reduce emissions," said the minister. For Habeck, the problem remains of convincing consumers. If you leave real money at the pump, you may think more about the household budget than about climate policy goals.

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