High gas and electricity prices pose an “imminent risk” of “production losses” and “outages of thousands of European companies”, warned BusinessEurope, an organization representing European employers, on Thursday. From bakeries to cell phone operators, everyone is alarmed by the readjustments of gas and electricity bills, and afraid of possible blackouts, resulting from the sudden drop in gas imports from Russia and the War in Ukraine.
In a letter to the President of the European Commission, Ursula von der Leyen, the employers’ association called for a more flexible mechanism for state aid to companies in difficulty, an urgent decoupling of electricity and gas prices, currently linked, and the mobilization of all resources available for electricity production. The energy crisis is the subject of a meeting of ministers from the 27 countries of the bloc scheduled for this Friday (30), in Brussels.
“It is urgent to find ways, at the European level, to mitigate the impact of energy prices that are paralyzing European companies, it is a matter of survival,” said the business lobby, which brings together organizations such as Medef in France and BDA in Germany. .
The European Executive and the 27 Member States have so far struggled to find solutions, given the different combinations of energy and interests of different countries. About “70% of European fertilizer production was halted or slowed down, while 50% of the total aluminum production capacity was lost”, quotes the BusinessEurope statement.
There is a real danger that companies, and in particular energy-intensive industries, will permanently relocate outside Europe”, warns the employer. “To avoid further production losses, the EU state aid mechanism needs to be adjusted to temporarily allow Member States to grant the necessary assistance to affected companies”, reads the letter sent to the presidency of the European Commission.
“Every megawatt hour (of electricity) and every billion cubic meters (of gas) will count this winter. More can and must be done to increase energy supply in Europe. and deploy additional renewable, nuclear, low carbon and natural gas capacity in Europe as quickly as possible,” adds BusinessEurope.
“With many companies on the verge of collapse, all options must be considered to facilitate energy production, including temporary legislative changes or moratoriums,” the organization declared, as nuclear reactors were shut down in Belgium and Germany.
To reduce the impact of rising energy prices, German Chancellor Olaf Scholz presented on Thursday a €200 billion plan to protect Germans from price increases in gas and electricity bills. Inflation in Germany reached 10.9% in September, in the 12-month period.
Bakeries start to close
In Belgium, the crisis that has befallen bakeries is uplifting. In this sector, in which ovens, refrigerators and freezers are essential equipment, the increase in energy prices has added to the increase in raw material costs (flour, oil and butter, among others). Bakery owners, a still family business run by small artisans, are closing their doors, unable to pay their electricity bills.
In a district of Gedinne, in the south of the country, the bakery owned by the couple Bertrand and Pascale Dumont received an invoice from the energy operator asking for a monthly advance payment of around € 11,800 against € 1,860, which they had paid until now.
According to Belgium’s French-speaking federation of bakeries, “ten, 15 or even 20 bakeries” have already closed since electricity prices have tripled in the country in recent weeks. Bread, one of the staples of everyday life, may be lacking in some places.
Belgium joined 14 other European countries to demand urgent action from the European Union to reduce the impacts of the energy crisis.
No cell phone?
Another situation that until a few days ago seemed unimaginable is starting to worry mobile phone users. If there are power cuts and rationing during peak hours, cellular networks can be randomly affected, and users will be left without a signal for communications.
Telecommunications sector officials fear that a harsh winter in Europe will put strain on infrastructure, forcing governments and companies to take rationing measures.
EU countries such as France, Sweden and Germany are working to ensure that telecommunications are preserved, even if power cuts end up draining the backup batteries installed in thousands of mobile antennas scattered across their territories.
Europe has nearly half a million telecommunications towers, and most are equipped with backup generators that last around half an hour.
France: two-hour cuts
In France, the situation is particularly complicated by the temporary shutdown of more than half of the country’s existing nuclear reactors (32 out of 56), due to maintenance operations or corrosion problems. RTE, the administrator of the high voltage network, believes that the risk of blackouts would only occur in exceptional situations. The company bets on information campaigns for consumers, which have encouraged the reduction of energy consumption to avoid unpleasant incidents. But occasional supply cuts are not ruled out.
A plan drawn up by Enedis, which operates the distribution of electricity on French territory, provides for cuts of a maximum of two hours a day in the worst-case scenario, company sources said.
Under a plan released in early September by Prime Minister Elisabeth Borne, those cuts, if necessary, would only affect some areas of the country. Essential services such as hospitals, police stations and administrations will be spared.
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