Terminating the renewables levy on electricity will save consumers 5.6 billion euros

German power consumers will save some 5.6 billion euros on their electricity bills once they stop paying the renewable surcharge as of 2023, the new government says in its coalition treaty, published this week. According to calculations by comparison portal Check24, an average household with an annual electricity consumption of 2,500 kWh will save 83 euros in 2022 and another 111 euros in 2023. The surcharge is used to pay for the support of renewable energy sources such as wind and solar PV and currently stands at 6.5 cents per kilowatt-hour. It will drop to 3.7 ct/kWh at the beginning of 2022, the last government decided. As of 2023, renewables funding will be paid for entirely from the state budget via the proceeds from CO2 pricing systems. Whether or not this price reduction will be a real relief to households will depend on the future development of wholesale power prices which are currently at a record high due to the high price for natural gas, hard coal and CO2 emission allowances.