Germany said to mull $9bn rescue of 'system-critical' Uniper amid Russian gas crunch
Europe's biggest fossil gas importer and emerging green energy player under pressure over curtailment as reports suggest €9bn rescue on cards
Finnish utility Fortum is in talks with the German government on how to stabilise its Uniper subsidiary to safeguard the security of supply in Europe’s largest economy in what could be the largest rescue measure in the continent’s energy sector.
Several alternatives are being discussed, among them a reorganisation of Uniper’s business portfolio to ringfence the system-critical German businesses under the ownership of the German government, Fortum said.
As the country’s biggest importer of fossil gas, Uniper has been hard hit by Russian gas curtailment and as a result is under extreme financial pressure. Since mid-June, the utility has received only 40% of the contracted gas volumes from Russia and had to source replacement volumes in the market at significantly higher prices.
“We welcome that the German parliament has now approved a ‘toolbox’ which will allow immediate relief to the effects of the gas supply crisis,” Fortum chief executive Markus Rauramo said.
“Next, we look forward to the German government to start promptly implementing these tools to stabilise the situation in the energy industry and in particular at Uniper, as we continue talks on a long-term solution.”
Among the legislative changes are amendments to the German Energy Security Act (EnSiG) to allow energy companies to obtain liquidity assistance in the form of guarantees, loans or recapitalisation by the German state. The law also provides the legal basis for the government to allow the passing of some or all of the high additional procurement costs caused by the shortage of Russian gas supplies to all gas customers – meaning consumers would have to carry the burden of gas price hikes and not importers.
German economics and climate minister Robert Habeck said the government is still in negotiations about the concrete form of support for Uniper or other energy sector players.
“Politically, one thing is clear: we will not allow a systemically important company to go bankrupt and cause turbulence on the global energy market as a result,” Habeck said.
“With the new legislation in the Energy Security Act, we have various options for action and we will act.”
The government hasn’t confirmed media reports of a bail-out or stake-taking in Uniper that would cost some €9bn ($9.14bn).