EEG surcharge: current development, definition & background – EHA

The current status: Abolition of the EEG surcharge is a done deal

The traffic light government has stipulated in the coalition agreement that the EEG surcharge is to be abolished. There the abolition was dated January 1st, 2023. In the meantime, it seems to have been decided that the abolition will take place on July 1st, 2022.

This is intended to curb the high energy prices for consumers. The expansion of renewable energies should then be financed entirely from budget funds.

Relief for end users and companies

The decision to abolish the levy is intended to relieve end consumers, which in principle also include companies, in times of rising energy prices.

However, there are doubts as to whether the abolition of the EEG surcharge will really lead to a noticeable relief for end consumers. Not least because of the rising energy prices, most recently also due to the Russian escalation in Ukraine, and the fact that energy suppliers are not obliged to pass on the EEG surcharge to consumers.

Due to the unsettled market we recommend:

1. To save as much energy as possible in the short term. About energy efficiency measures in general or about industry-specific measures, such as our energy saving tips for retail.
2. To rely on structured procurement in the medium and long term in order to better spread the risks involved in electricity procurement.

Counter-financing of the missing income

The abolition of the EEG surcharge means a change in the system of green electricity subsidies. How the eliminated EEG surcharge should be counter-financed is currently also part of the discussions. It is clear that the counter-financing should come from budget funds. CO2 pricing, which was introduced on January 1, 2021, plays a role here in order to create incentives to phase out fossil fuels (quicker) or to switch to environmentally friendly alternatives earlier.

What is the EEG surcharge? The origin

The EEG surcharge was introduced in 2000 by the Schröder government. The name comes from the “Renewable Energy Sources Act” (EEG), which is intended to promote the expansion of renewable energies and is therefore an important driver of the energy transition. So the way from the non-sustainable use of fossil fuels and nuclear energy to a sustainable energy supply using renewable energies.

The EEG levy obligation is currently financing the energy transition

The expansion of renewable energies is financed by means of the EEG surcharge.

In principle, every electricity consumer has to pay the EEG surcharge via the electricity price. The surcharge, like other various electricity surcharges, is added to the pure energy price or passed on to the end consumer via the electricity price. In this sense, end users are also companies.

The functional principle behind the EEG surcharge

On the one hand allowed Operators of plants for renewable energies, i.e. electricity from wind, water, sun, geothermal energy or biomass, for example, are guaranteed to feed the electricity produced into the power grid – the operators of such systems are also referred to as EEG feeders. This is referred to as preferential feeding of electricity from renewable energies into the public grid. This feed-in is guaranteed by the EEG.

the operator of the public network on the other hand, are obliged by the government to buy the electricity from the producers. And at a predetermined price – this is also regulated in the EEG.

The grid operators then sell the electricity on the electricity exchange. On the electricity exchange, however, the network operators do not receive the price that they previously paid to the plant operators and would therefore actually make a loss. However, since the grid operators are obliged to purchase the electricity, this difference is compensated for by a nationwide pot, which is fed from the EEG surcharge.

Development of the EEG surcharge: an overview of the amount

How high is the EEG surcharge? In 2022, the surcharge will be 3.7 cents per kilowatt hour.

The federal government had already set a cap on the EEG surcharge for 2021 to 6.5 cents/kWh in 2021 and 3.7 cents/kWh in 2022, which has been in effect since January 1st, 2022.

The following illustration shows the development of the allocation price in recent years:

EEG levy exemption: Who is exempt from the EEG levy?

However, the EEG surcharge is not the same for all electricity consumers or all consumers have to pay the EEG surcharge.

There are numerous exceptions and reductions. In this way, companies from certain sectors that consume particularly high electricity consumption and are in international competition can receive discounts. Discount models also exist for rail transport systems. All discounts are recorded in the Special Compensation Scheme (BesAR) in §§ 63 ff. EEG 2021.