Germany’s environment agency calls for coupling renewables surcharge with carbon price

A price on carbon emissions from fossil fuels could help to drastically reduce the cost of Germany’s renewables surcharge for customers and effectively accelerate emissions reduction in the country, according to an expert opinion commissioned by the Federal Environment Agency (UBA). The report says that expanding the costs of Germany’s Renewables Act (EEG) on coal, gas, diesel and petrol by 30 euros for every tonne of CO₂ could wash about ten billion additional euros into the state’s coffers and help bring down the renewables surcharge from 6.88 cents per kilowatt hour (kWh) in 2017 by up to 3 ct/kWh. The UBA also presented a second option to spread the energy transition’s costs “onto more shoulders” and recommended an energy tax on coal and gas production to make production more expensive and bring up wholesale power prices, thereby reducing the need for renewables support in the first place.

Find the UBA report in German here.

See the CLEW articles Rising CO2-price could trigger German coal phase-out in 5 years and Energy minister rejects idea of changing fees and taxes on energy and the factsheet How much does Germany’s energy transition cost? for more information.