German chemical industry faces “massive problems” due to high energy prices

The German chemical industry was facing “massive problems” due to high energy prices, the country’s chemical industry association (VCI) said on Friday.

“Our companies are exposed to unprecedented price increases for electricity and gas,” said VCI CEO Wolfgang Grosse Entrup ahead of the debate on high energy prices in the German Bundestag, lower parliament.

Nearly two-thirds of companies in Germany’s chemical industry reported that energy prices were severely disrupting their operations, according to a recent VCI survey. Due to international price pressure, many companies were unable to pass on rising costs to customers.

The industry association demanded that the electricity tax in Germany should be reduced to the minimum rate set by the European Union (EU) and that the so-called EEG reallocation charge, a levy for the expansion of renewable energy, had to be abolished immediately.

“This will give companies room to breathe again and the strength they need for the climate-friendly transformation,” said Grosse Entrup. “Low electricity prices are the best climate protection, because many transformative technologies rely on electricity.”

Prices of energy products in Germany in 2021 were markedly up by 10.4 percent year-on-year, driving annual inflation to 3.1 percent, the highest level since 1993, according to the Federal Statistical Office (Destatis). ■

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