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07 Jul 2020, 13:22
Kerstine Appunn

Renewables levy could be reduced to zero by 2021 – German Energy Agency (dena)

Clean Energy Wire

German households could be further supported in coping with the coronavirus crisis by lowering the renewables surcharge they pay with their power bills to zero, German Energy Agency dena, the Institute for Public Economics at the University of Cologne (FiFo) and the Foundation for Environmental Energy Law (Stiftung Umweltenergierecht) find in a paper. The resulting lower electricity prices would also strengthen competitiveness, the authors say. The idea builds on the government’s announcement to cap the renewables levy to 6.5 ct/KWh in 2021 and 6 ct/kWh in 2022, a measure worth 11 billion euros in total out of its 130 billion euro coronavirus stimulus package. The groups say that the renewables levy could be reduced to zero up until 2030 if the electricity tax is increased to 4.1 cent, which would result in an overall reduction in the power price of 4.5 ct/kWh. “Only this fundamental restructuring of the renewables levy and the electricity tax will make it possible to achieve considerable simplifications in energy law, relieve companies and authorities of the burden of enforcement and processing and thus achieve further economic benefits,” the authors conclude.

The German power price is subject to taxes and levies that make electricity expensive despite a steady decline in wholesale power prices over recent years. As electricity becomes ever more important in an integrated energy system where it is to replace fossil fuels in heating and transport as well, the power price is an essential lever to steer future development.

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