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ENERGY

German government moves to end short-notice energy contract terminations

With thousands of customers currently left out in the cold by providers cancelling electricity and gas contracts at short notice, Germany is planning to introduce tighter controls on the energy sector.

Heat cost allocator on a radiator
A heat cost allocator, for calculating heating costs, on a radiator. Photo: picture alliance/dpa | Sina Schuldt

The government says it wants to put a stop to short-notice terminations of electricity and gas contracts by low-cost providers as well as sudden price hikes. 

“We must not leave consumers out in the cold like this again,” Oliver Krischer (Greens), Parliamentary State Secretary in the Federal Ministry of Economics, told DPA in Berlin. “This was and is a great burden for many people and a huge shock to suddenly find a notice of termination from the gas or electricity provider in the letterbox.”

Krischer also announced that the there would be uniform tariffs for basic energy supply in future, so that new customers do not face bills that are twice or three times as high as those paid by existing customers.

“Split basic-supply tariffs are in the end just make additional work for the courts, which we want to avoid,” he said.

Split tariffs are when an energy provider offers different rates for new and existing customers.

READ ALSO: How households in Germany can tackle rising energy costs

In addition, energy providers will have to give their customers several months’ notice if they decide to cancel their energy contracts so that people have time to look for a new supplier.

With energy prices soaring over the past year, struggling low-cost providers have cancelled thousands of contracts at short notice, leaving customers grappling to organise a new contract at an affordable rate. 

These consumers then tend to automatically move to the the so-called substitute supply with a basic supplier in their area – but often have to pay significantly more for this back-up service. 

The newly formed Ministry for Energy and Economics, which is run by the Greens, wants to stop this from happening.

Oliver Krischer (Greens) speaks in the German Bundestag

Oliver Krischer (Greens) speaks in the German Bundestag. Photo: picture alliance/dpa | Bernd von Jutrczenka

“There is a need for action,” said Krischer. “We therefore want to raise the hurdles for discontinuing supply and put the instrument of basic and substitute supply on a new footing.”

He added that the ministry would also make proposals on how dubious competitors could be better filtered out by the Federal Network Agency.

“The fact that around one million gas and electricity customers are being terminated within a very short time must not be repeated,” he warned. 

READ ALSO:

Split energy tariffs 

According to a position paper of the Federation of German Consumer Organisations, some new customers have found themselves paying up to €1,654  more per year in tariffs than existing customers.

This is because budget suppliers tend to purchase low-cost energy for their customers in advance to keep costs low in the long-term.

However, with prices rapidly rising due to supply issues and the effects of the pandemic, these same suppliers have been forced to secure more energy at significantly higher prices to cater to a higher-than-expected number of new customers. 

Therefore, some suppliers have started to differentiate between new and existing customers and to supply new customers at more expensive tariffs. In the view of the consumer centres, however, this is legally inadmissible, dangerous for fair competition and incomprehensible. 

READ ALSO: German local authorities demand reduction in energy prices

According to the Ministry of Energy and Economics, concrete proposals for amendments to the Energy Industry Act are now being worked out in close cooperation with the Ministry of Consumer Protection.

The aim is to provide more protection for consumers through clear notice periods before supply is discontinued and to improve the regulations on substitute supply and basic supply.

Vocabulary 

short-notice cancellation / termination – (die) kurzfristige Kündigung

basic supply – (die) Grundversorgung 

a huge burden – (eine) große Belastung 

to react to something – auf etwas reagieren 

We’re aiming to help our readers improve their German by translating vocabulary from some of our news stories. Did you find this article useful? Let us know.

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LIVING IN GERMANY

Living in Germany: Exploring locally, Bargeld and the NRW state election

In our weekend roundup for Germany we look at exploring the country this summer, the country's obsession with cash and some facts about North Rhine-Westphalia, which goes to the polls on Sunday.

Living in Germany: Exploring locally, Bargeld and the NRW state election

A chance to explore Germany 

Although we’re still in the pandemic, it feels like life in Germany is beginning to feel a bit more like it did before Covid hit us. With many restrictions easing, people have been really enjoying spring and looking forward to summer.  So it’s no surprise that many of you have been reading our stories about travel. Our articles on the €9 monthly ticket as well as train travel in Germany and beyond have been particularly popular. The public transport offer will also give many people the chance to explore closer to home. I know I am really looking forward to seeing more of Germany, whether it’s around the Brandenburg area near where I live, or going further afield (Heidelberg, I’m looking at you). I’d love to know if you want to use the €9 ticket or if you have any plans to explore Germany this summer. Please fill in this survey on the €9 ticket (it’s open until Monday) and get in touch with your opinions or other travel plans by emailing [email protected]. Thanks so much to those of you who’ve already been in touch.

Tweet of the week

The German love of cash or Bargeld in 2022 while the rest of the world goes contactless is indeed one of life’s greatest mysteries, as this tweet highlights. We’ll definitely be using our ‘ask a German’ series to try and find out more about this habit… 

Where is this? 

Pankstrasse U-Bahn
Photo: John MACDOUGALL / AFP

Berliners or those who’ve visited the capital may recognise this U-Bahn station which is situated in the north. The station is actually part of the Pankstrasse nuclear fallout shelter. Built in 1977 during the Cold War, this “multi-purpose” facility was intended to protect the citizens of West Berlin in case of a nuclear conflict. The bunker serves not only as an U-Bahn stop for commuters but also, in an emergency, could have sheltered 3,339 people for up to two weeks. For those interested, we’d recommend checking out a tour like those run by Berliner Untervelten E.V. Due to Vladimir Putin’s invasion of Ukraine, which has led to massive tension between Europe and Russia, the tours have become even more topical.

Did you know?

Since people in the state of North Rhine-Westphalia (NRW) or Nordrhein Westfalen are going to the polls this Sunday, we thought we’d look at some facts about this western state. This is Germany’s most populated state with about 17.9 million people. It’s also home to the most foreigners – around 2.5 million non-Germans live in NRW. With cities such as Cologne, Düsseldorf, Dortmund and Essen, the state is a culturally rich and diverse part of Germany. Many people don’t know that Bonn was the capital of the former West Germany all the way up to reunification, before Berlin took the title. Many federal buildings and institutions still have their base there. 

The state is led by Christian Democrat Hendrik Wüst who took over last year after Armin Laschet resigned as state premier following his unsuccessful federal election bid. The CDU is currently in a coalition with the Free Democrats. But it looks like change is on the horizon. The CDU and the Social Democrats are both polling at around 30 percent, with the CDU having a slight lead of two to four percentage points. Meanwhile, the FDP appears to have lost support. It’s going to be a tight race – and the Greens party – polling at around 17 percent – will likely be the kingmakers. Important topics for voters include the future of German industry, and how to secure jobs in the move to renewable energy. Many people see this election as a test for the federal government which is led by the SPD’s Olaf Scholz. 

Thanks for reading,

Rachel and Imogen @ The Local Germany 

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