Germany today announced 200 billion Euros package for its consumers to cap rising energy prices.
German Chancellor Olaf Scholz termed a €200 billion ($194 billion) “defensive shield” to protect companies and consumers against the impact of soaring energy prices.
Scholz said, “The German government will do everything in its power to bring [energy] prices down. We are now putting up a large defensive umbrella … which we will endow with €200 billion.”
The package was the outcome of negotiations between the Economy Minister Robert Habeck from the Greens and Finance Minister Christian Lindner from the liberal Free Democrats.
Europe’s biggest economy is currently grappling with surging gas and electricity costs occasioned by a collapse in Russian gas supplies to Europe, with Moscow blaming the crisis on Western sanctions following its invasion of Ukraine in February.
Under the new plan, Berlin will introduce an emergency price brake on gas and electricity prices and also scrap a previously planned gas levy on consumers to avoid any further price increases. The gas levy, which was slated to come into effect from Saturday and remain in place until April 2024, was intended to help utilities cover the cost of replacing Russian supply. The government has also suspended its limit on new debt of 0.35% of gross domestic product this year.