The government of the German State of Baden-Württemberg, which the first time in history has a Minister-President from the Green party, has issued a press release with some thoughts about the coming rise in feed-in tariff surcharges in Germany.
This is of course expected to be a talking point vigorously exploited by various anti-renewable propaganda efforts.
The government expects a rise of about 1.5 cents per kWh. It attributes 0.24 of that to new solar capacity, and 0.7 to all new renewable capacity. The remainder is caused by the fact that the 2011 reform of the Law on Priority for Renewable Energy handed out favors to more industry players in the form of lower tariffs, which results in less shoulders to distribute the burden.
The additional 1.5 cent would work out to between 60 and 80 euros per year for the avarage household. However, the merit order effect (cheaper wholesale electricity prices) is actually about in the same ballpark. If utilities don’t pass on those savings but only pass on the higher surcharge, blaming renewable energy for the price increase is not fair.
Fortunately, consumers can easily change their utility if they understand what is going on. Passing on the surcharge cost and not passing on the savings from lower wholesale prices will of course raise the utility profits by exactly that amount.
The government estimates that consumers can save up to 200 euros a year by changing to a utility that offers more attractive prices. The government plans to explain this to their citizens by appropriate campaigns.
They also plan to step up their efforts in helping citizens save electricity. There is still much explaining to do in that area.
In a related article, Craig Morris notes that the surcharge cost is at about 0.3% of the average family income in Germany. The total bill for electricity is about 2.2% of average income. Having that grow to 2.3 or 2.4% as a consequence of the coming surcharge rise is not ever so big a deal. He also points out that while the price per kWh is higher than in most United States locations, the cost is actually less since Germans have switched faster to more efficient technologies, saving more electricity.