Germany nationalizes Uniper, UK determines energy subsidies

The German government will own around 99% of Uniper and 8% of the Finnish parent company Fortune (FOJCF)German Economy Minister Robert Habeck told reporters in Berlin on Wednesday.

Uniper provides 40% of the country’s gas supply and is crucial for large companies and private consumers in Europe’s largest economy.

In July, Chancellor Olaf Scholz announced that the government would rescue Uniper with a package worth 15 billion euros ($15.3 billion) after it was brought to its knees by months of Russian supply cuts and rising market prices.

Under the bailout deal, the government pledged to provide 7.7 billion euros ($7.8 billion) to cover potential future losses, and state bank KfW agreed to increase its credit line by 7 billion euros ($7.1 billion).

But Habeck said the situation had worsened “tremendously” since Russia indefinitely cut gas supplies to Europe through the Nord Stream 1 pipeline on September 1, citing an oil spill.

Russian gas has had to be replaced by expensive alternatives, and bills for consumers have risen.

Despite the disruption of gas supplies via Nord Stream 1, Germany’s gas reserves are more than 90% full to capacity, European storage provider GIE AGSI+ said on its website.

However, Europe’s energy crisis will not go away.

Habeck said the country could “get through the winter just fine” without Russian gas, but warned that supply levels are “really empty” after that.

The UK sets out grants for businesses

Germany is not alone in paying a very high price to overcome gas supply shortages. Together, EU states and the UK have already committed more than $500 billion to help households and businesses cope with rising energy costs.

The British government on Wednesday gave more details of its plan to protect the economy next winter. It said it would cap electricity and gas costs for businesses at less than half the market rate for an initial six-month period.

The announcement follows a pledge earlier this month to cap average household energy bills at £2,500 ($2,834) a year over the next two years.

UK Finance Minister Kwasi Kwarteng said he would outline the overall cost of the program on Friday.

Analysts say the total bill could reach £150 billion ($170 billion). The tax cuts promised by new Prime Minister Liz Truss come at a time when debt repayment costs are rising and the pound is already trading at 37-year lows as investors worry about the fragile health of the British economy.

– Anna Cooban contributed to this article.