Municipal forecast for 2023: utilities expect 60 percent increase in electricity prices

The exploding costs for energy are threatening the existence of the public utilities.

Municipal forecast for 2023: utilities expect 60 percent increase in electricity prices

The exploding costs for energy are threatening the existence of the public utilities. The most recent gas price reductions in the wholesale trade do not change that. The association of municipal companies expects high increases in electricity prices for the coming year.

According to the VKU association, Germany's municipal utilities are expecting significantly higher electricity prices in the coming year. So far, these have risen less than gas prices, for example because the EEG surcharge has been eliminated. But further increases in electricity are also to be expected, a spokesman for the Association of Municipal Enterprises (VKU) told the "Neue Osnabrücker Zeitung".

After prices have risen by around 10 percent so far, an increase of around 60 percent is expected for the coming year. When it comes to gas, end customers of Stadtwerke often have to pay between 30 and 60 percent more than before the Ukraine war. But there are also municipal utilities that have to more than double their prices, sometimes even more. From the point of view of the municipal companies, the recent gas price reductions in the wholesale trade are not yet a reason to give the all-clear.

In view of the exploding costs for electricity and gas, the municipal utility warned of widespread insolvency on the part of customers and bankruptcies within their own ranks. "So far, the payment defaults have been well below one percent of the sales from delivered quantities, that's manageable," said the general manager of the VKU, Ingbert Liebing. "But if we get five to ten percent or even threaten 15 or 20, then that can become a threat for the municipal utility."

The VKU represents the interests of more than 1,500 companies, including municipal utilities in particular, with a turnover of around 123 billion euros. "We can already see that the situation is getting tighter. Just a few months ago, we saw the risks on the horizon and said 'we have to prepare for this'. But now we are realizing that certain problems, liquidity problems, become more acute," explained Liebing. The Stadtwerke are systemically important in total. "Of course we want to prevent a wave of bankruptcies, that's our top priority."

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