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Germany to ‘fast-track’ gas terminals as part of Qatar deal

Germany has committed to "fast track" the construction of two liquefied natural gas terminals as part of a new long-term deal with Qatar as it looks to reduce dependence on Russian gas.

Economics and Climate Minister Robert Habeck after talks with the Minister of Trade and Industry of Qatar in Doha.
Economics and Climate Minister Robert Habeck after talks with the Minister of Commerce and Industry of Qatar in Doha. Photo: picture alliance/dpa | Bernd von Jutrczenka

Economic Affairs Minister Robert Habeck secured the accord during talks in Doha with its emir and energy minister who have been pressing European nations to strike long-term deals to guarantee their supplies.

European states have been forced to turn to Qatar in recent months as they seek an LNG alternative to Russian gas in the wake of Moscow’s invasion of Ukraine.

Qatar has insisted on long contracts because of the huge cost of investing in gas production. Already one of the world’s top three LNG exporters, Qatar plans to increase production by 50 percent by 2027.

READ ALSO: Germany seals energy deal with Qatar in move away from Russia

Qatar’s energy ministry said that several years of talks with Germany had never led to “definitive agreements due to the lack of clarity on the long-term role of gas in Germany’s energy mix and the requisite LNG import infrastructure.”

It added that in a meeting between Habeck and Energy Minister Saad Sherida Al-Kaabi, “the German side confirmed that the German government has taken swift and concrete actions to fast-track the development of two LNG receiving terminals in Germany as a matter of priority to allow for the long term import of LNG to Germany and that such scheme has the full support of the German government.”

The two sides “agreed that their respective commercial entities would re-engage and progress discussions on long-term LNG supplies from Qatar to Germany.”

READ ALSO: Germany begins slow move away from Russian gas after Ukraine invasion

In Berlin, a German spokeswoman confirmed a long-term partnership had been struck and that companies would “enter into the concrete contract negotiations”, the spokeswoman said.

Habeck also held talks in Doha with the emir Sheikh Tamim bin Hamad Al-Thani before heading to the United Arab Emirates where he is expected to hold talks on oil supplies.

Ahead of his trip, Habeck told Deutschlandfunk radio that Germany had major concerns over securing supplies for next winter.

“If we do not obtain more gas next winter and if deliveries from Russia were to be cut then we would not have enough gas to heat all our houses and keep all our industry going,” he warned.

Berlin has come in for criticism over its opposition to an immediate embargo being imposed on Russian energy supplies as a means of choking off Moscow’s foreign earnings.

Germany believes a boycott could cause major economic damage as well as huge rises in energy prices.

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ENERGY

REVEALED: Germany’s planned hardship fund to help with energy bills

The gas and electricity price caps are coming, and the government wants to pay people's energy bills in December - but will that be enough to stop people falling into hardship? Germany's Economics Ministry thinks it won't be and has drafted plans for a new hardship fund. Here's what you need to know.

REVEALED: Germany's planned hardship fund to help with energy bills

When Germany’s traffic light coalition parties – the SPD, Greens and FDP – took office last December, they had no idea that they would be facing an energy crisis on such a major scale.

But with Russia’s invasion of Ukraine sending the gas market into turmoil, the coalition’s big plans have been put on the backburner as they work out how best to support people with rising costs. 

Under the latest set of energy relief measures put forward by the Gas Price Commission, the government will shoulder the cost of people’s energy bills this December. It also plans to introduce a cap on both electricity and gas prices, which will come into force next March and be backdated to January.

READ ALSO: Germany plans to cap energy prices from start of 2023

This multi-billion relief package is likely to soften the blow for many households, but according to a new government document obtained by Bild, ministers are concerned that it won’t be enough to stop many people – and businesses – falling into financial hardship.

To ensure this doesn’t happen, federal and state economists ministers want to set aside billions more for additional aid. 

Here’s who can get hold of the extra cash – and how.

Renters and private home owners

People who rent an apartment in Germany and home owners who live in their properties can access additional help from the state if they can prove they’re over-burdened by their heating and energy costs.

That could be due to an eye-wateringly high back-payment for energy bills demanded by the landlord or due to the fact that they have to purchase expensive fuel such as wood pellets for heating. 

More specifically, people claiming unemployment benefits such as Bürgergeld can get some extra cash from the Jobcenter after their bills are calculated by the landlord. If they’re facing a hefty back-payment, or Nachzahlung, they can get up to three months of Bürgergeld retroactively to help cover the costs. 

In addition, someone who wants to claim Bürgergeld for a single month will be spared from having to prove the amount of money they have in the bank. Under the ordinary rules for Bürgergeld claimants, job seekers must have less than €40,000 in savings.

According to the government’s calculations, this emergency buffer is set to cost around €500 million. Claims for additional support will be handled by the job centres or social offices.

Small- and medium-sized businesses (SMEs)

Small business owners have been among the hardest hit by the energy crisis – but luckily help may be on its way. 

In the document obtained by Bild, ministers say they assume that the gas and electricity price cap will be an adequate level of support for most SMEs. Nevertheless, there could be a few circumstances in which business owners slip through the net:

  • Business owners may already be facing huge hikes in their energy bills before the price caps come into force, for example in the form of a big back-payment for energy costs over several months, or
  • Businesses may find that, due to exceptional circumstances, they’re still unable to pay their bills – even after the price caps are introduced. 

In these two scenarios, SMEs can apply for extra support from the government. 

To be eligible, businesses must either show that their energy costs quadrupled at least three months between January and November 2022, or they’ll have to show that their energy costs have also multiplied in spite of the energy price cap and that their business is highly energy-intensive or costly.

The government expects this support package to cost around €1 billion and says that the details will be worked out after state premiers agree to the proposals.  

READ ALSO: How electricity prices are rising across Germany

Housing companies 

Large landlords could also be in line for some additional government aid under the ministers’ plans. Due to the way the current rental system works, many are paying high bills for heating and energy that they’re not yet able to recoup from tenants in the end-of-year bill.

Housing complexes in Berlin.

Housing complexes in Berlin. Photo: picture alliance/dpa | Monika Skolimowska

To help housing companies that are in this situation, the government wants to offer loans that could help tide them over. Twenty percent of this credit would be secured by the federal states, and the measure is expected to cost around €1.1 billion. 

Hospitals and care homes  

Care facilities and clinics face exorbitant energy bills – even in ordinary times – so this group of institutions will also be given financial aid, the draft said.

This will come in the form of a one-off support payment and ongoing support with gas and electricity bills. Hospitals and care homes will in many cases get their additional costs for energy completely refunded by the state until April 2024. Social agencies and social service providers will also be given subsidies and financial aid to help deal with their increased overheads. 

In addition, cultural sites and facilities like museums and art galleries will get subsidies intended to flatten out the rise in energy costs. In most cases, the energy price cap only applies to 80 percent of a business’ ordinary consumption, but this limit will be dispensed with for cultural institutions. 

However, the government says it still wants to incentive energy-saving measures as well as offering financial support. 

READ ALSO: When will people in Germany get their December gas bill payout?

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