Opposition attacks German minister's energy plans

BERLIN, Feb 2 (Reuters) - The head of Germany’s opposition Social Democrats (SPD) criticised government plans to cap power price rises for consumers but signalled on Saturday he was open to talks.

Conservative environment minister Peter Altmaier last week outlined proposals to spread the cost of Germany’s switch to renewables away from nuclear power between households and industry before September’s election.

However, it was unclear whether the proposals will become reality due to resistance within Chancellor Angela Merkel’s centre-right coalition and also from opposition parties who could block any law in the Bundesrat upper house.

In a sign that the plans could face major obstacles, SPD leader Sigmar Gabriel told the Bild am Sonntag newspaper his party also wanted to reduce the burden on consumers but that he disagreed with Altmaier’s ideas.

“The government is dishonest about power prices: it complains about the rising renewable power surcharge but earns hundreds of millions of euros through value added tax,” he said.

He wanted the government to reimburse the extra income to consumers.

“That will be the SPD’s proposal when we go into talks with the government,” he said, adding a wholesale reform of Germany’s renewable energy law was required.

Other senior SPD figures, including members of the Bundesrat upper house, attacked the plans as “populist” and “half-baked”.

“Altmaier’s suggestions are pure propaganda,” said senior Greens lawmaker Juergen Trittin in the Berliner Zeitung.

With an election in eight months, Merkel is keen to show voters she is trying to curb rises in household power bills which have soared due mainly to a sharp rise in the surcharge imposed to fund the switch to renewables.

Her energy initiative is widely seen as the most significant domestic policy of Merkel’s second term.

Under Altmaier’s plans, increases in subsidies to renewable power producers would be capped for two years and feed-in tariffs to new installations could be suspended. Energy intensive firms which had been largely exempted from the surcharge may also have to pay.

The plans are being watched closely by power and carbon traders. On Friday even a comment by Merkel saying she supported her minister’s plans pushed up prices.

Altmaier told the Frankfurter Allgemeinen Sonntagszeitung that he wanted to have his proposals take effect on Aug. 1.

“The energy switch can only been presented in a positive light if the question of price is resolved and people do not have to fear that prices will always rise further,” he said.

Germany’s Free Democrats (FDP), who share power in Merkel’s centre-right coalition, have also voiced dissatisfaction with the plans, saying they go in the right direction but that they prefer a bigger reform. (Reporting by Madeline Chambers, editing by William Hardy)