More and more consumers in Germany are feeling the effects of rising energy costs.

The Brandenburg company Otima Energie is going bankrupt in view of higher expenses and has stopped supplying electricity and natural gas.

The company asks its customers to give them the meter readings.

“At the same time, we recommend that you look for a new supplier as soon as possible in order to minimize the damage to you or your company,” says the website of the company based in Neuenhagen near Berlin.

In addition to the wholesale prices, which have quadrupled, Otima Energie speaks of a significant increase in prepayment and security payments as reasons for the move.

Jan Hauser

Editor in business.

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This is the first known utility bankruptcy given the higher prices for natural gas and electricity. Other energy companies are also changing their business for the time being. The Essen-based E.ON Group, with more than 14 million customers, is now no longer accepting new natural gas contracts for new customers. Other suppliers are restricting their advertising for the time being. Deutsche Energiepool, based in Salzbergen in Lower Saxony, announced that it had terminated natural gas contracts for many customers.

The question for the energy suppliers is what quantities of natural gas they have bought in the long term and can thus pay even cheaper prices from the past - or how much they have to order at higher prices in the short term in order to supply customers.

According to its own information, Deutsche Energiepool had to buy additional daily spot quantities despite the futures market, which would have tripled its procurement prices.

The company has therefore discontinued the nationwide supply of natural gas.

"In order to guarantee the preservation of all jobs in our company, we will concentrate on services in the energy sector in the future," it said.

Who steps in in the event of bankruptcy?

In view of this development, the Association of Municipal Enterprises (VKU), which represents many municipal utilities, is trying to calm down. If a provider files for bankruptcy, as in the case of Otima Energie, and then fails to meet the delivery obligations towards the customer, the basic supplier will replace the end consumers with lower purchase quantities, the association informs. That is mostly the local public utility. After three months at the latest, customers would have to sign a new supply contract.

Lawyer Janka Schwaibold considers it understandable in view of the higher prices not to accept any more new customers, but she raises the question of whether a termination of a concluded contract is permissible. In any case, this suggests that there is a mismatch between product design and procurement strategy. "Such suppliers are now threatened with collapse and, in the worst case, bankruptcy," said the partner for energy law at the Schalast law firm. On the other hand, terminated customers are safe: The predominantly municipal basic suppliers will then supply them with electricity and natural gas.

Schalast expects, however, that the crisis will not affect the entire energy market because many suppliers are stocking up in the long term.

Municipal companies in particular are already buying for the following year.

"What used to be disadvantageous for municipal utilities in the competition and the general reputation of being too expensive is now an advantage."

The Association of Municipal Entrepreneurs names many reasons for the rise in wholesale prices for natural gas, such as the economic boom in the world after the Corona crisis.

In addition, there was the particularly cold and long heating period in Europe last winter, which means that the natural gas storage facilities are comparatively less full.

The generation of electricity from renewable energies is also below average.

When will the end customer prices rise?

Nevertheless, the security of supply in Germany is high. "We are currently not seeing any supply bottlenecks," said a VKU spokesman on request. "According to feedback from our member companies, the demand for gas is currently being fully met." He points out that municipal utilities buy the amount of energy they need in the long term in tranches of around three to four years in order to avoid price peaks that are currently being seen. "Short-term price increases on the market, as we are currently seeing, are thus buffered when setting prices." However, the consequences of the price increase for natural gas customers cannot yet be assessed. The decisive factor is the temperature profile in winter, which results in the need for heating. "But we also tend to expect rising end customer prices," said the spokesman.

In August, the import prices for natural gas were 177.5 percent higher than in the same month last year, as the Federal Statistical Office has calculated. For consumers, however, natural gas was only 5.7 percent more expensive in September. In addition to long-term contracts with suppliers, it is also noticeable that part of the end customer price for electricity and natural gas is fixed through taxes, network charges, costs for metering and billing or a license fee.

The credit insurer Euler Hermes assumes that the soaring gas prices will continue until spring.

Should it get very cold in the northern hemisphere, there could be further temporary price increases on the energy raw material and electricity markets: "But even in a mild winter, countries could be inclined to stock up on their stocks as a precaution." a significantly increased risk of insolvency for smaller utilities in Germany and Great Britain, according to a study published on Thursday.