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Sunday, Jul 13, 2025

German parliament approves €200B energy relief plan

German parliament approves €200B energy relief plan

Industry and consumers are struggling with skyrocketing energy prices.
Germany's parliament on Friday voted to adopt the government's proposal for a €200 billion gas price relief fund — a measure that has sparked tensions with other EU countries.

The plan comes as industry and consumers struggle with skyrocketing energy prices. Private households could benefit from a price cap of 80 percent of their usual consumption, starting in March. The price cap for big companies will come into effect as soon as January.

The move is only possible by suspending the debt brake, enshrined in the country's constitution. It limits the federal government's structural net borrowing to 0.35 percent of GDP. However, it can be suspended "in the event of exceptional emergencies."

German Chancellor Olaf Scholz tweeted that it was a "green light" for the measure, which he called a "double-kaboom."

"That's good news for everyone who looks at their utility costs with concern. And for trades and businesses," he said.

The details of how the plan will work still have to be finalized.

Germany's go-it-alone plan, which wasn't jointly agreed at EU level, has sparked fierce criticism, with countries and Brussels worried it will skew the bloc's internal market by giving German businesses access to cheaper energy than their rivals.

European Internal Market Commissioner Thierry Breton called for "mutualized tools at the European level" and French Economy Minister Bruno Le Maire warned: "We run the risk of breaking up the eurozone" if countries don't coordinate their strategies to tackle the energy crisis.
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