The German energy expert Manuel Frondel has warned of possible “unexpected price peaks” in view of rising electricity prices. However, he does not think much of price caps. (archive image)
“It is to be expected that electricity prices will continue to rise in autumn and winter because the demand for electricity increases during this time, especially in countries like France, where electricity is used for heating,” said the energy expert from the RWI Leibniz Institute for Economic Research Düsseldorf “Rheinische Post” from Tuesday.
“If the supply then remains tight, for example if half of the French nuclear power plants continue to fail, or if the supply is even tighter, as with the shutdown of the three remaining German nuclear power plants, the electricity price can reach further unexpected price peaks.”
At the same time, Frondel warned of price caps: “Intervention in the market’s pricing mechanism” would be “the completely wrong way to react to this,” said the energy expert. “Social hardship should be cushioned as specifically as possible in low-income households.
It would also be conceivable to have another energy price lump sum, as is now being granted in September 2022 and in which low-income households are more favored than wealthy households, since the wealthy have to pay more tax on this lump sum.”
On Monday, German Chancellor Olaf Scholz was open to putting the brakes on energy prices at European level. Current electricity prices “cannot be justified,” said the Chancellor during a visit to Prague.