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ENERGY

Customers unlikely to see TelDaFax money

The official insolvency procedures of energy firm TelDaFax have begun in a Bonn court, but refunds appear to be a pipe dream for most of the failed utility's 700,000 former customers.

Customers unlikely to see TelDaFax money
Photo: DPA

“Consumers need to adjust to the fact that they will likely get nothing or only a very small sum,” said lawyer Jan Bornemann, who is playing an advisory role during the case.

TelDaFax offered customers cut-rate electricity if they pre-paid their bills before the company filed for insolvency. Bornemann said in such proceedings it is often considered lucky if creditors get five percent of what they’re owed back.

Some customers are owed thousands of euros for energy supplies they paid the company for up to a year in advance. Other creditors include suppliers and employees, who are trying to get their unpaid salaries.

TelDaFax declared it would enter insolvency proceedings in June following a year of financial turmoil in which it was accused of shoddy accounting practices and running a business that could only stay afloat by rapidly attracting new prepaid customers.

By the end of its life, the company appeared to be doing everything possible to cut expenses, most notably by bowing out of a sponsorship deal with the Bayer Leverkusen football team – a move which was expected to save TelDaFax €13 million ($18.7 million).

According to Bornemann, there’s a simple lesson to take from the situation: “The cheapest is not the best.”

He said that if a company is asking for advance payments to provide a future service, consumers should ask themselves what the odds are that the company could go out of business.

A special meeting for TelDaFax creditors has been scheduled for November. In the meantime, those who are known to be owed money are being sent forms with which to officially register their claims.

Those who don’t receive their forms in the coming weeks should register their claim with the court.

The Local/DAPD/mdm

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ENERGY

German government announces fresh relief package for high energy costs

With Russia's invasion in Ukraine exacerbating high energy and petrol prices, Germany is set to introduce a second relief package to limit the impact on consumers.

German government announces fresh relief package for high energy costs

The additional package of measures was announced by Economy and Climate Protection Minister Robert Habeck (Greens) on Sunday.

Speaking to DPA, Habeck said the wave of price increases throughout the energy sector were becoming increasingly difficult for households to bear.

“Extremely high heating costs, extremely high electricity prices, and extremely high fuel prices are putting a strain on households, and the lower the income, the more so,” he said. “The German government will therefore launch another relief package.”

The costs of heating and electricity have hit record highs in the past few months due to post-pandemic supply issues. 

This dramatic rise in prices has already prompted the government to introduce a range of measures to ease the burden on households, including abolishing the Renewable Energy Act (EEG) levy earlier than planned, offering grants to low-income households and increasing the commuter allowance. 

READ ALSO: EXPLAINED: What Germany’s relief package against rising prices means for you

But since Russia invaded neighbouring Ukraine on February 24th, the attack has been driving up energy prices further, Habeck explained.

He added that fears of supply shortages and speculation on the market were currently making the situation worse. 

How will the package work?

When defining the new relief measures, the Economics Ministry will use three criteria, Habeck revealed. 

Firstly, the measures must span all areas of the energy market, including heating costs, electricity and mobility. 

Heating is the area where households are under the most pressure. The ministry estimates that the gas bill for an average family in an unrenovated one-family house will rise by about €2,000 this year. 

Secondly, the package should include measures to help save energy, such as reducing car emissions or replacing gas heating systems.

Thirdly, market-based incentives should be used to ensure that people who use less energy also have lower costs. 

“The government will now put together the entire package quickly and constructively in a working process,” said Habeck.

Fuel subsidy

The three-point plan outlined by the Green Party politician are not the only relief proposals being considered by the government.

According to reports in German daily Bild, Finance Minister Christian Lindner (FPD) is allegedly considering introducing a state fuel subsidy for car drivers.

The amount of the subsidy – which hasn’t yet been defined – would be deducted from a driver’s bill when paying at the petrol station. 

The operator of the petrol station would then have to submit the receipts to the tax authorities later in order to claim the money back. 

Since the start of the war in Ukraine, fuel prices have risen dramatically in Germany: diesel has gone up by around 66 cents per litre, while a litre of E10 has gone up by around 45 cents.

READ ALSO: EXPLAINED: The everyday products getting more expensive in Germany

As well as support for consumers, the government is currently working on a credit assistance programme to assist German companies that have been hit hard by the EU sanctions against Russia.

As reported by Bild on Saturday, bridging aid is also being discussed for companies that can no longer manage the sharp rise in raw material prices.

In addition, an extension of the shorter working hours (Kurzarbeit) scheme beyond June 30th is allegedly being examined, as well as a further increase in the commuter allowance.

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