With the EU’s approval, Germany will pour 1,1 billion euros into its rail sector to alleviate it from the skyrocketing electricity traction prices. The German government decided to act against the increased energy costs in late 2022 by reducing electricity prices for rail operators. The billion euros package from Brussels will compensate for this price reduction.

The EU Commission mentioned that Germany’s financial plan falls within the State Aid rules without distorting competition, hence the approval. The state aid scheme will be in effect for the entirety of 2023.  As for the German government, it decided to support rail operators in December 2022 when the parliament voted in favour of reducing electricity prices to 13 cents per kWh.

Back then, Conor Feighan, secretary general of ERFA, had explained in an interview to RailFreight.com that the support measure would apply for up to 90 per cent of historical or forecast demand. In practice, Germany will implement the measure by reducing freight and passenger operators’ monthly expenses and directly reimbursing the electricity suppliers.

Need for more similar measures

The EU Commission admitted that the measure is of significant importance considering the impact of the Russian invasion of Ukraine on energy prices, and specifically electricity. Some could say that help came quite late. However, it’s in the hands of each European government to implement such support measures and not the EU’s.

As UIRR has highlighted before, most EU Member States have not supported or even considered supporting their railways. That is why more similar measures should be in place soon in Europe. For instance, transport associations in France have stressed that rail freight operators might soon struggle to pay their bills since the expenses are unprecedented.

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