The cabinet of German Chancellor Olaf Scholz has approved the abolition of the country’s renewables levy to alleviate pressure on consumers burdened with the surge in energy costs in the wake of Russia’s invasion of Ukraine.

The EEG surcharge, a levy most German consumers pay on top of electricity bills to finance the expansion of renewables plant, had already fallen to €0.03723/kWh ($0.044/kWh) this year, down from €0.065/kWh in 2021, as the government began to subsidise it from the federal budget and funds from CO2 pricing.