Altmaier Paper on Renewable (5): Surcharge Reductions for Industry

This post is one in a series I am writing right now discussing German Environment Minister Peter Altmaier’s recent proposals on reform of the Law for Priority for Renewable Energy, which fortunately have zero chance of getting enacted.

In this particular post I will address the proposal to change the rules for industry surcharge reductions. Here it is in German:

Die Besondere Ausgleichsregelung für stromintensive Unternehmen wird reduziert und begrenzt. Dies geschieht durch eine vertretbare Erhöhung der Mindestumlage und gegebenenfalls durch eine Deckelung der begünstigten Gesamt-Strommenge. Die Regelung wird so ausgestaltet, dass sie wirksame Anreize zur weiteren Stromersparnis bietet. Insgesamt kann dadurch ebenfalls eine Dämpfung der Umlage um bis zu 500 Mio. Euro erreicht werden. Da die Börsenstrompreise seit 2011 deutlich gesunken sind – was den großen industriellen Stromverbrauchern zugute kommt – ist eine solche Maßnahme gerechtfertigt und ohne größere Belastungen möglich.

In contrast to most of the other proposals, this is something that the Social Democrat and Green opposition parties also have called for, so there is a good chance that the surcharge reductions for industry will be changed.

I learn from Altmaier’s paper that these reductions account for EUR 4.3 billion of the EUR 16.6 billion paid last year as cost of the feed-in tariff system. That’s a significant amount, so changes here may have substantial effects, possibly exceeding the EUR 500 million that Altmaier wants to shave from the costs by this measure.

And I agree completely that renewable energy’s merit order effect has brought down wholesale prices for electricity, which means that industry can well afford to shoulder a larger share of the burden.

The only problem I have with this proposal is that at this stage it is lacking in detail. But I expect this to happen in one way or other, since the opposition parties agree with it.

Published by kflenz

Professor at Aoyama Gakuin University, Tokyo. Author of Lenz Blog (since 2003, lenzblog.com).

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