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IK survey: High energy prices hurting German plastic packaging industry

Due to rising energy prices, the German plastic packaging industry is facing increasing competition from international companies, according to a new survey from the IK trade association.The plastics trade group, Industrievereinigung Kunststoffverpackungen (IK), stated that the cost increase of the EEG (Germany's renewable energy law) allocation for this year alone is in the six-digit range for medium-sized companies. Whereas power costs in France are only half as high and in the U.S. electricity prices have partially dropped to as little as 5 cents per kilowatt hour.

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IK survey: High energy prices hurting German plastic packaging industry

IK estimates that prices will continue to increase. The EEG-allocation may go up to above 7 cents per kilowatt hour.

"The current concept of the energy policy turnaround with its mad costs for industry and consumers that have run out of control must be stopped at once," said IK managing director Ulf Kelterborn, in a news release. "Or else, a number of medium-sized businesses will be unable to maintain their production in Germany. Already, larger companies are thinking about leaving."

IK, together with many other organizations of the small business sector, has long demanded a market-economy-alignment of energy production, the association stated.

IK believes that current developments on the international energy markets, such as the cost-efficient natural gas production by fracking in the U.S. or in England, show that the current German concept of the turnaround of energy policy will fail the international comparison of power prices. This also strongly endangers Germany as an industry location, the association stated.

With more than 300 members, the IK is the biggest trade association within the plastics packaging industry in Europe. IK represents the lion's share of the German plastics packaging market, accounting for more than 4 million tons of plastic packaging and films.

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