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ENERGY

Germany’s Scholz in Saudi Arabia on Gulf energy hunt

German Chancellor Olaf Scholz arrived Saturday in Saudi Arabia at the start of a two-day Gulf tour, in the hope of sealing new energy deals with the fossil fuel exporters.

Published: 24 September 2022 18:09 CEST
German Chancellor Olaf Scholz
German Chancellor Olaf Scholz pictured at the entrance of the Chancellery in Berlin on September 23, 2022. Photo: Tobias SCHWARZ / AFP

Scholz, accompanied by a sizeable industry delegation, was received at Jeddah airport on the Red Sea coast by Mecca region’s governor Prince Khalid bin Faisal Al Saud.

Afterwards, he went into a meeting with Saudi Arabia’s de facto ruler Crown Prince Mohammed bin Salman.

He is also scheduled to meet a group of Saudi women, before heading to the United Arab Emirates on Saturday evening and then to Qatar on Sunday.

The chancellor hopes to agree new energy partnerships with the oil- and gas-rich Gulf states, with the loss of supplies from Russia in the wake of its invasion of Ukraine.

Scholz however is faced with a diplomatic balancing act, as he will have to navigate significant differences with his hosts over human rights.

Scholz’s meeting with the Saudi crown prince is seen as particularly sensitive.

Until recently, Prince Mohammed was regarded as a pariah in the West due to the murder of Washington Post journalist Jamal Khashoggi in 2018.

The German government strongly condemned the journalist’s murder and would not be “editing” its position, government sources indicated ahead of the tour.

Saudi Arabia’s importance as a fossil fuels exporter and regional power meant a “solid working relationship” was needed with the crown prince, a government source explained.

The 37-year-old Prince Mohammed was likely to steer the country through “the next 10, 20 or 30 years”, he added.

Berlin wants to extend cooperation on new technologies such as green hydrogen produced using renewable energy, which Germany could import in vast quantities from the Gulf states, said government sources.

The chancellor would also seek to strengthen political cooperation with the regional powers, courted on the other side by Russia and China.

“We have to work with Saudi Arabia if we want to sort out, for example, the question of the war in Yemen or tackle the Iranian question,” the government source said.

On Sunday morning, Scholz will meet with UAE’s President Sheikh Mohamed bin Zayed Al-Nahyan.

Later that day, the chancellor will travel to gas-rich Qatar to hold talks with Emir Sheikh Tamim bin Hamad Al-Thani.

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PRACTICAL TIPS

How a quarter of German households can save on their electricity bills

Customers can save a high three-digit sum on their household electricity costs, according to calculations done by German price comparison portals. Here's why you may want to switch your tariff.

Published: 22 May 2024 11:23 CEST
How a quarter of German households can save on their electricity bills

German households are overpaying for electricity by billions of euros each year, according to calculations carried out on the Verivox price comparison portal.

This is because nearly a quarter of households in Germany purchase electricity via the most expensive tariff group from their local supplier – the so-called ‘basic supply’, or Grundversorgung in German.

But in Germany, customers have energy tariff options, and saving hundreds on your energy bill can sometimes be as simple as checking your current tariff online and switching to a cheaper one in a matter of minutes.

Based on approximately ten million households consuming electricity from the basic supply, Verivox calculates that Germans are overpaying by about €5.5 billion annually. That’s because the average difference between basic supply rates and the cheapest local energy rates currently amounts to 20 cents per kilowatt hour (kWh).

What is the ‘basic supply’ for household energy?

Household electricity in Germany is purchased through different tariffs (Stromtarifs). Through these various tariffs, local energy companies offer different prices for electricity, depending on customer contracts.

The basic supply tariff for electricity can be thought of as the default. When a new house is connected to the energy grid, for example, its electricity will be provided via the basic supply unless the homeowner chooses another tariff option.

READ ALSO: How to change electricity and gas providers in Germany

The basic supply is intended to ensure that everyone has access to electricity, even if they haven’t shopped around for an energy provider on their own. It can also be advantageous in the short term because it can be cancelled at any time, as opposed to other tariffs which typically come with longer contracts.

But the basic supply is comparatively expensive. According to Verivox, basic supply electricity currently goes for an average of 44.36 cents per kilowatt hour (kWh), whereas the cheapest available rates on average come to 24.7 cents/kWh across Germany.

How much can you save?

At current rates, you can expect to save about 44 percent on your electricity bill if you switch from basic supply to the cheapest option with a price guarantee. 

That amounts to significant savings, considering that annual electricity costs regularly come to a few thousand euros in German households.

The Hamburger Abendblatt reported that a three-person household consuming 4,000 kWh would save an average of €786.

These prices will vary from provider to provider and from region to region. 

Keep in mind that choosing other tariff options often comes with some additional fees. Still, in many cases taking a look at different electricity tariff options can save households some money.

Also, switching tariffs is different from switching your energy provider. If you currently get basic supply electricity from Vattenfall, for example, you could potentially switch to a different tariff option while maintaining your business with them. But if you are between contracts, or currently on basic supply, you could also consider switching providers.

In this case, a comparison portal like Check24 can be useful to get an idea of which companies offer the best rates.

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