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23 Feb 2021, 11:55
Julian Wettengel

Chipmakers lament high taxes and levies on electricity in Germany

Handelsblatt / Dlf

Several chip and semiconductor manufacturers have criticised high taxes and levies on electricity as a disadvantage for Germany as an industry location in global competition, reports business daily Handelsblatt. “The high electricity price makes the location unattractive,” Christoph von Plotho, head of chip supplier Siltronic, told Handelsblatt. Another main reason were high personnel costs in Germany. At the same time, a spokesperson of Germany’s largest semiconductor producer Infineon told Handelsblatt that a secure power supply without fluctuations was also a major factor in keeping production in Germany and Europe. The comments showed that the issue of high power costs extended beyond the traditional industry companies like chemical factories, to high tech sectors, writes Handelsblatt. The reason for high power prices are taxes and levies on electricity, such as the renewables levy to finance the expansion of wind and solar energy. Many companies are partly or fully exempt from certain levies. In addition, the government has started to use state budget funds, such as revenues from the new CO2 price for transport and heating fuels, to help cap the renewables levy and it plans to further decrease it over coming years.

Keeping or establishing high-tech production in Europe could be essential for key energy transition sectors such as future mobility. Public broadcaster Dlf reported a current supply bottleneck of micro chips from Asia was harming the car industry world wide due to the supply of input materials being tightened for political reasons.

The power prices paid by industry are one of the most contentious aspects of Germany's energy transition. Since wholesale prices have fallen during the energy transition while taxes and levies have increased substantially, the price of power for industrial consumers in Germany can be both extremely high and extremely low. Business lobby groups routinely call the price of electricity a central threat to industry competitiveness. But sweeping claims in this debate hide the fact that there is no single power price for industrial consumers, but instead an exceptionally broad range of prices.

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