Households could save up to 413 euros a year without renewables levy – economic institute

At the Handelsblatt Energy Summit earlier this month, German economy minister Peter Altmaier said he aimed to abolish the country's renewables levy to finance the expansion of mainly wind and solar power within five years. This would save households and companies hundreds of euros per year, according to calculations by the industry-financed Cologne Institute for Economic Research (IW Köln). Based on the assumption that the EEG (Renewable Energy Act) levy, which is to be six cents in 2022, will be reduced by 1.5 cents each year, it will reach zero in 2026 - at which point renewables support will be financed through the federal budget. Compared to today, IW Köln calculated that an average family of four could save up to 412 euros that year without the levy. A single household would save around 124 euros in 2026. Overall, IW Köln assumes that lifting the renewables levy will have a positive impact on the energy transition, due to the reduced electricity prices.

Germany’s renewables legislation (EEG), which was launched 20 years ago, is responsible for the significant growth in onshore wind, solar PV and biogas by establishing grid priority for these power sources and guaranteeing them generous feed-in tariffs. The latest reform of the EEG, which specifies a timeline of tenders for renewable power installation additions until 2028, came into effect on 1 January 2021. By 2027, the government wants to propose how, and by when, renewables funding via the EEG could be stopped entirely – provided a market-driven renewables expansion is to be expected.