- Renewables to become cheaper in Germany as Government Passes Law
- Tax on renewables consumption to be removed
The German government has made a favourable move towards consumption and consequently the demand for more renewables among the consumers in the country. There is a surcharge that electricity consumers pay on their electricity consumption in Germany. Going by the law that has now been passed, from the 1st of July 2022, the surcharge will no longer apply to renewable energy electricity consumption.
Embedded in the proposal for the law is the condition that utility operators within the country will also pass on the effect of the displaced charge onto the end consumers in the country, leading to a lower end-user consumer price.
The fee was added in 2000 to create a finance mechanism that will allow for the expansion of renewable energy in Germany while also ensuring that there is a balance between market prices and the cost of energy produced. However, taking effect from 2022, the charge removal will translate into a EUR 300 lesser fee for a household of four persons compared to the 2021 price. The weight of the levy removal will now fall on provisions made available by the Federal and Climate Fund, totalling up to USD 7.25 billion.