German climate economist sees 2023-24 winter as bigger challenge

The worst energy problems facing Germany will arise in the 2023-24 winter rather than in the coming months, a renowned economist specializing in climate change told dpa in Potsdam on Sunday.
"The big challenge will not arise in the 2022-23 winter, rather we have to master the 2023-24 winter," Ottmar Edenhofer, professor of the Economics of Climate Change at Berlin's Technical University, said.
"We have to make gas savings of in the region of 15% at a European level to get through the winter," Edenhofer, who serves as scientific director to the Potsdam Institute for Climate Impact Research, said.
Over the years ahead, Germany would have to cut its gas consumption by 30% compared with the level before the Russian invasion of Ukraine, he said. Savings would have to be made primarily in household consumption to avoid reductions in industrial production and job losses.
"We will be able to master the current energy crisis only through social compensation," Edenhofer said, urging the German government to set up administrative tools to make direct payments to lower income households to help them meet their energy bills.
He expressed doubts about the government's decision to cut value-added tax on gas to 7% from 19% previously and called for subsidies on gas consumption to be reduced in order to increase incentives to save.
Along with other economists, Edenhofer is putting forward a model at European level that would pay a premium to member states that successfully cut gas consumption.
"Thus far, member states have in fact been subsidizing gas consumption, by cutting VAT and abolishing taxes on gas," he said. "This is a dangerous situation and contradicts the incentive to save energy at a time when saving gas is required both for the climate and geopolitically."