Securing the energy supply
The energy company Uniper is the largest German importer of Russian gas and is suffering an acute financial emergency. The Federal Government took over 99 percent of the company in order to secure Germany’s energy supply. This stabilisation measure taken by the Federal Government is subject to a ban on bonus and dividend payments.
On 19 December, the Federal Government and Uniper specified the terms for the company’s recapitalisation in a framework agreement: the stabilisation measure is linked to clear conditions, in particular a ban on bonus and dividend payments. The purpose of the agreement is to implement the rescue package for the company that was announced on 21 September 2022.
99 percent takeover
The Federal Government previously agreed on support measures for Uniper on 22 July 2022. A further increase in costs led to a deterioration in the company’s situation to such an extent that the Federal Government decided in September to take over a total of 99 percent of the energy supplier. This will stabilise Uniper and secure energy supplies for companies, municipal utilities and consumers.
Federal Chancellor Olaf Scholz emphasised on 21 September: “It is essential that we make these decisions now to pave the way for a future for Uniper. We have agreed on this with the previous shareholder. The war does indeed have far-reaching consequences. As you know, we have already provided support to Uniper worth several billions and also with loans.”
The energy company Uniper is of decisive significance for Germany’s gas and electricity supply. The company supplies around 200 municipal utilities around the country. As the largest importer of Russian gas, the company finds itself in an acute emergency as a result of the lack of gas deliveries from Russia and sharp increase in gas prices.
Economic protective shield
The Federal Government is providing funding for the company’s recapitalisation as part of the economic protective shield worth 200 billion euros that was established to address the consequences of the Russian war of aggression. To this end, the Federal Government reactivated and realigned the Economic Stabilisation Fund, aiming to soften the most severe effects of rising energy costs on consumers and businesses.
The takeover is a necessary step
“This step became necessary because the situation has once again significantly changed and become exacerbated since the announcement by the Federal Chancellor on 22 July,” said Federal Minister for Economic Affairs Robert Habeck in his press statement on 21 September. “Since 1 September, no gas has been flowing through Nordstream 1. A situation which we have, so far, handled extraordinarily well as a country. Storage levels have reached 90 percent and the gas price, after a brief upward swing, has now fallen from the highest level of 350 euros per megawatt hour in the summer to the current level of under 200 euros.” For Uniper, this has significantly intensified and exacerbated the situation. “Uniper has a 50 percent share of Russian gas in its portfolio and accounts for 40 percent of the German gas supply. This, taken together, forced us into action. Following a market analysis and examination of the alternatives, we made this decision in order to secure the supply security in Germany,” the Minister stressed.
Note: The originally planned gas surcharge was cancelled retroactively on 30 September.