Germany's economics ministry Sunday said government plans to cap a rise in household electricity prices aren't far-reaching enough, signaling major obstacles within Chancellor Angela Merkel's own center-right coalition if the legislation is to become law before the general election.
Germany
's
economics ministry Sunday said government plans to cap a rise in household
electricity prices aren't far-reaching enough, signaling major obstacles within
Chancellor Angela Merkel's own center-right coalition if the legislation is to
become law before the general election.
Environment Minister Peter Altmaier last week announced plans to freeze
subsidies to renewable-power producers at current levels until the end of 2014
and force industry players to pay a greater share of the bill for
Germany
's
energy shift to renewable power.
But Economic Ministry spokesman Adrian Toschev told Dow Jones Sunday that Mr.
Altmaier's plans don't go far enough.
"We welcome the fact that the environmental minister is reacting to our
long-standing call to reform the existing subsidies for renewable
energies," said Mr. Toschev. "However, there is still the need for a
more fundamental reform which would control costs more effectively by relying
on elements of a free-market economy."
The economics ministry, which is led by Free Democrats leader Philipp Roesler,
will continue to "participate constructively" in the discussion about
how to reform the system, the ministry spokesman said.
He declined to comment on a report in German weekly Der Spiegel, which said an
internal study by the economics ministry is convinced Mr. Altmaier's plan will
fail as it won't solve the underlying problem of the current system.
Mr. Altmaier, a senior ally of Ms. Merkel in the Christian Democratic party,
told German Sunday newspaper Frankfurter Allgemeine Sonntagszeitung he's
determined to push legislation through by Aug. 1, well before the upcoming
national parliamentary elections.
Ms. Merkel's ruling center-right coalition is becoming increasingly concerned
the costs of Germany's energy shift towards renewables will become a political
issue in the elections and hurt Ms. Merkel's chances for another term in
office.
In another sign that opposition to Mr. Altmaier's plan is mounting, the head of
Germany
's
opposition Social Democrats told the Bild am Sonntag newspaper that the SPD
also wants to reduce the burden on consumers but disagrees with how the
government wants to achieve it.
"The government is dishonest about power prices," SPD party head
Sigmar Gabriel told the Sunday paper. "It complains about the rising
surcharge for renewable energy, but at the same time earns hundreds of millions
of euros through the value-added tax," Mr. Gabriel said.
Gabriel said the SPD wants the government to pay back this extra income to
consumers. "That will be our position when we enter negotiations with the
government," Mr. Gabriel told the paper.
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