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Germany: Chancellor Scholz announces new relief package, state to aid gas giant Uniper

German news. German Chancellor Olaf Scholz announces a new rescue package is being prepared for one of the largest German gas importer.

Scholz interrupts his vacation to save Uniper

The German chancellor interrupted his holiday in the Allgäu and returned to Berlin. His reason for coming back to Berlin was to announce a rescue package for the German gas giant Uniper.

The gas company used the remaining liquidity reserves and benefits from a multi-billion dollar loan from the stat-owned development bank KfW.

Uniper applies for state aid to keep from going bankrupt

The largest German energy company, mostly owned by the Finnish company Fortum, is currently under tremendous pressure as the Russian government has restricted gas supplies to Germany and Western Europe and gas market prices have risen enormously.

The federal government is currently working on a relief package for Uniper. The company recently applied for state aid.

READ MORE: Germany: Economy Minister raises warning level for gas supplies

How is Uniper’s applying for state aid going to affected people in Germany?

Bild wrote that an insolvent supplier could not supply any more gas and the federal government wants to prevent this from happening.

The federal government is preparing for Uniper to pass on its costs to the customers such as municipal utilities or large industrial enterprises – despite existing contracts.

The rescue package will be presented shortly after difficult negotiations between the governments in Berlin and Helsinki. Only the last details remain to be clarified – reports BILD.

The federal government’s share in the company can be as high as 30 percent. In addition, Uniper financing should be supported. The state development bank’s credit line should be increased to around eight billion euros.

Federal Economy Minister Robert Habeck promised on Thursday, July 21, quick support for Germany’s largest gas importer. He also stressed the need to create a social balance for end customers who are overwhelmed by high prices. He announced that if prices increased, there would be a relief for consumers.

Source: BILD