Germany’s government next year will pay a subsidy in order to lower the country’s renewables supplement - a levy consumers have to pay on top of their electricity fees to finance the expansion of renewable energies – in order to cushion the impact of the Covid-19 pandemic.

The renewables levy (EEG surcharge) will fall to €0.065 ($0.076) per kilowatt hour in 2021, from €0.06756/kWh this year. The levy will then recede further to €0.06/kWh of power consumed in 2022. Berlin will finance the subsidy through a rise in CO2 prices and other budget funds.

“As part of the economic stimulus program to cope with the consequences of corona, the federal government has promised a reduction in the EEG surcharge,” economics and energy minister Peter Altmaier said.

“We keep this promise today. For the first time, the EEG surcharge will be reduced through a federal grant.”

Without the federal subsidy, the levy would have shot up to €0.096/kWh, the federation of offshore wind farm operators (BWO) pointed out, welcoming the government’s action.

“The corona crisis already has done enough harm. We now need to make sure together that electricity consumers won’t be burdened additionally,” BWO managing director Stefan Thimm said.

Offshore grid link fee

The BWO added that a surcharge to finance offshore wind grid links will also fall slightly, from €0.00416/kWh to €0.00395/kWh.

In order to achieve a lasting fall in Germany’s high electricity costs, the offshore wind industry lobbies for the introduction of contracts for difference (CfDs), however, in future auctions for wind at sea.

A government proposal to amend the country’s Wind at Sea Act is currently being discussed in parliament that instead would introduce the possibility of negative bids, meaning operators would have to pay for being granted a license to build an offshore wind farm.

Germany’s renewable energy federation BEE said instead of just capping the level of the EEG surcharge, the government should finance exemptions for heavy industries from paying the levy with funds from the federal budget.