Germany must cap power prices with 'great speed' to relieve the burden on consumers, Chancellor Olaf Scholz says

• German Chancellor Olaf Scholz said the nation must cap power prices rapidly to help consumers.
• Scholz added that policymakers must change the market design to ease gas and electricity costs.

Germany must impose a price cap on power prices to help people handle soaring electricity costs amid a worsening energy crisis, Chancellor Olaf Scholz said in a Berlin speech at a BDA employers association conference, per Bloomberg.

"We will now push this through with great speed, so that we can relieve the burden on consumers as well as on companies when it comes to electricity prices," Scholz said, noting that policymakers are exploring ways to bring down heating and gas prices as well.

The market, as it stands, is producing high costs for consumers in a way that is not justified by production, he explained, so it needs intervention.

"We will make sure that we can do the same for the heating and gas market," Scholz said, adding that natural gas poses a different challenge from the electricity market.

At the same time, he suggested that a natural gas price cap may not be the most effective way forward, as it could reduce supplies from a global market that involves the US, Norway, and other countries that are supplying Germany inventories.

"We will take further measures to get those prices down from the source and make them competitive and affordable again for the German industry," Scholz said.

Meanwhile, the European Union has weighed options to intervene in energy markets to ease pressures on citizens and businesses. This month, ministers are holding an emergency meeting for talks to lower prices.

According to Reuters, European Commission President Ursula von der Leyen is expected to unveil proposals in a speech Wednesday.