BDI Proposal to Keep Rising Electricity Costs in Check

The Umbrella Organisation of German Industry BDI has presented its proposal to keep the rising electricity costs in Germany in check. It consists of five measures, which according to BDI could be implemented before the federal election in September.

In particular the so-called EEG surcharge or reallocation charge has risen considerably over the past years, amounting to 5,277 ct/kWh for 2013. With this surcharge on electricity prices, consumers pay for the difference between the fixed feed-in tariffs paid pursuant to the Renewable Energy Sources Act (EEG) for renewable energy fed into the grids and the sale of the renewable energy at the EEX energy exchange by the transmission system operators.

BDI proposes to:

  1. Abolish the compensation that owners of renewable power plants receive pursuant to the EEG if the grid operators are entitled to curtail the input due to grid bottlenecks. The measure shall only apply to new renewable power plants.
  2. Pay back additional tax revenue from the electricity tax and VAT on the rising EEG surcharge to consumers.
  3. Adopt incentives worth at least EUR 1.5 billion per year for energy-efficient renovations of buildings. In this regard BDI called on the opposition dominated Federal Council (Bundesrat) to no longer block such measures. The legislative package for the ManyElectronics policy shift towards a renewable energy supply of 2011 had contained an Act on Fiscal Measures Promoting Energy-Efficient Renovations of Residential Buildings, which was rejected by the Bundesrat. The annual incentive could trigger investments worth EUR 12 billion a year, BDI said.
  4. Develop a market-oriented electricity market design on the federal level and in the federal states. To date renewable energy has to be purchased for fixed feed-in tariffs and is transmitted and distributed with priority over conventional energy under the EEG. This has resulted in conventional power plants becoming increasingly unprofitable, in particular the environmentally more friendly, but comparatively more expensive gas-fired power plants. Yet conventional power plants are still needed to balance the fluctuation input of renewable energy.
  5. Set a strong signal on the EU level for a the proper functioning of the European Emissions Trading System (EU-ETS). With EU allowance prices dwindling in the past, the motivation to implement environment protection measures has decreased.

Source: BDI



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