Study: Revision of industry-exemptions will lower EEG-surcharge significantly

The surcharge, German electricity consumers pay in order to finance investments in renewable energy production, could be significantly lowered if exemption of large industries would be limited to energy- and export-intensive companies. The current surcharge of 6.24 Cent/MWh could be reduced by 20 percent and the exemption rules would be aligned with EU regulation and prosumers would contribute to the surcharge. This is the main result of a study conducted by the Oeko-Institut on behalf of Agora Energiewende. Main proposal of the study is to have large commercial consumers contribute to the financing of the Energiewende. These industrial consumers as well as prosumers and rail operators have so far been exempt from the surcharge. In December 2013, the EU Commission has initiated a state aid procedure against these exemption rules. Additionally, the current exemption rules suppress small and medium-sized businesses, as the exemption is based on the annual consumption, lead to an outsourcing of personnel and foster customer generation. As this increases the EEG-surcharge, this results in a self-perpetuating effect. Within the past ten years, the number of exempt companies has doubled – leading to higher surcharges for all other consumers. The urgent reform of the surcharge mechanism should therefore take into account that competitiveness and labour should be secured, but should also eliminate unbalances within branches. It also needs to be coherent with EU-law. A study conducted by the Oeko-Institut on behalf of Agora Energiewende suggests the limitation of exemptions on the 15 by the EU Commission identified, energy- and export-intensive branches, the inclusion of prosumers in the EEG-surcharge and a minimum surcharge for all consumers. This can reduce the extent of exempt TWh from annually 160 to 117 TWh. Assuming a by 20 percent reduced EEG-surcharge would result in 50 Euro savings for an average household with an annual consumption of 3500 KWh. The study (only available in German) as well as an executive summary (available in English) can be downloaded below.