Debate on scrapping renewables levy gathers pace in Merkel's conservative party

Plans to scrap Germany's renewables levy are maturing within Chancellor Angela Merkel's conservative Christian Democratic Union (CDU), with a new proposal suggesting investors should finance the country's renewables roll-out instead of consumers, reports Klaus Stratmann in business daily Handelsblatt. The head of the party's state association in Hamburg , Christoph Ploß, and former solar battery start-up sonnen CEO, Philipp Schröder, argue the roll-out should be considered an infrastructure investment that can be financed with earmarked green bonds. In a position paper, Ploß and Schröder say Germany needs to become the world's cheapest market for clean industrial electricity by 2030 in order to keep energy-intensive key industries as well as attract new ones. "Large institutional investors are desperate for the opportunity to invest in green, sustainable bonds," the authors write.

Ploß and Schröder say their plan could lower the average wholesale power price to 20 euros per megawatt-hour. Prices paid by retail consumers would fall by 15 percent in the short term and by at least 30 percent by 2030, they say. Their plan is also geared towards speeding up Germany's lagging expansion of renewable energies in order to cover 80 percent of demand by the end of the decade. The authors say their concept could generate an additional 200,000 jobs in renewable construction and a further 800,000 in new energy-intensive industries, according to a report in pv magazine. 

Federal energy minister Peter Altmaier (CDU) had initially said the renewables surcharge (also known as EEG-levy) should be abandoned step-by-step in the next five years, and that whoever forms a government following the September elections needs to decide on this. But he is now working on a proposal to completely abolish the EEG-levy in the medium term and finance it through the federal budget. To alleviate the financial burden on consumers, who since 2021 also pay a CO2 price on fossil heating and transport fuels, the EEG surcharge was capped to 6.5 cents this year and 6 cents next year by refinancing it from the federal budget for the first time.