Call to prevent power cuts in poorest German households

More than 340,000 electricity customers across Germany have their power cut off each year for failing to pay bills. A new proposal from one political party aims to change this.

Call to prevent power cuts in poorest German households
Energy poverty is an increasing problem in Germany. Image: DPA

Figures from 2017 show that there were 343,865 cases of people having their electricity shut down off due to not paying a bill, an increase of 14,000 from the previous year.

The average amount owed in these instances was €117, highlighting how close many German individuals and families are to the breadline. 

A total of 6.6 million warning letters are sent on average each year, of which 1.2 million power blocking orders are sent. The figures indicate that just under one third of those blocking orders results in a power cut. 

Poverty has been on the rise in Germany in recent years. A 2017 study showed that approximately 13.4 million people in Germany live in poverty or are considered at risk of poverty, representing roughly 16 percent of the population. 

A proposal from the left-wing Greens party hopes to change this by putting in place an ‘electricity cost allowance’, an amount that would be paid in addition to the current Hartz IV (German social welfare) rate. 

‘Energy poverty’

While having a phone or internet connection cut off is likely to be inconvenient, losing access to basic utilities can be significantly problematic – particularly in the harsh German winter. 

The Süddeutsche Zeitung, citing a proposal drawn up by the Greens, reported that tens of thousands of Germans frequently go without power. The Greens want to avoid a situation where German families cannot heat their apartments or cook food. 

The proposal would also eliminate the costs associated with sending reminders and for blocking and unblocking an electricity account. 

Electricity bills are rising in cost. Image: DPA

Lower-income Germans the most affected

Sven Lehmann, a spokesperson for the party, told the Süddeutsche Zeitung that the changes were necessary to address electricity price hikes and cost of living increases.

“About half of the total power cuts are for people receiving social help,” he said. 

“Since the introduction of Hartz IV, electricity costs have risen more than the standard costs of electricity.”

The electricity cost allowance would be paid in addition to the current Hartz IV rate. Where a household starts to enter debt due to rising electricity costs, a scheme would be developed to allow them to repay the amount without incurring further debt.

The proposal also included funding for lower income households to upgrade from their current appliances to newer ones which use less energy. 

Many of these households already struggle to meet their existing financial obligations, meaning upgrading and improving appliances is impossible. 

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“Electricity shut offs can be prevented,” Lehmann said. 

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Court turns down AfD-led challenge to Germany’s spending in pandemic

The German Constitutional Court rejected challenges Tuesday to Berlin's participation in the European Union's coronavirus recovery fund, but expressed some reservations about the massive package.

Court turns down AfD-led challenge to Germany's spending in pandemic

Germany last year ratified the €750-billion ($790-billion) fund, which offers loans and grants to EU countries hit hardest by the pandemic.

The court in Karlsruhe ruled on two challenges, one submitted by a former founder of the far-right AfD party, and the other by a businessman.

They argued the fund could ultimately lead to Germany, Europe’s biggest economy, having to take on the debts of other EU member states on a permanent basis.

But the Constitutional Court judges ruled the EU measure does not violate Germany’s Basic Law, which forbids the government from sharing other countries’ debts.

READ ALSO: Germany plans return to debt-limit rules in 2023

The judgement noted the government had stressed that the plan was “intended to be a one-time instrument in reaction to an unprecedented crisis”.

It also noted that the German parliament retains “sufficient influence in the decision-making process as to how the funds provided will be used”.

The judges, who ruled six to one against the challenges, did however express some reservations.

They questioned whether paying out such a large amount over the planned period – until 2026 – could really be considered “an exceptional measure” to fight the pandemic.

At least 37 percent of the funds are aimed at achieving climate targets, the judges said, noting it was hard to see a link between combating global warming and the pandemic.

READ ALSO: Germany to fast-track disputed €200 billion energy fund

They also warned against any permanent mechanism that could lead to EU members taking on joint liability over the long term.

Berenberg Bank economist Holger Schmieding said the ruling had “raised serious doubts whether the joint issuance to finance the fund is in line with” EU treaties.

“The German court — once again — emphasised German limits for EU fiscal integration,” he said.

The court had already thrown out a legal challenge, in April 2021, that had initially stopped Berlin from ratifying the financial package.

Along with French President Emmanuel Macron, then chancellor Angela Merkel sketched out the fund in 2020, which eventually was agreed by the EU’s 27 members in December.

The first funds were disbursed in summer 2021, with the most given to Italy and Spain, both hit hard by the pandemic.