German industry says EU rules for electricity subsidies are too strict
Handelsblatt / Clean Energy Wire
German industry associations have criticised the European Union's conditions for member states seeking to subsidise companies' electricity costs, reported Handelsblatt. The EU had to ask itself “how political rhetoric on European competitiveness fits in with such restrictive implementation rules,” Holger Lösch, deputy chief executive of industry association BDI, told the business newspaper. He called for an update to add more flexibility.
The German government has worked out a concept for electricity price subsidies for industry (“industry electricity price”) for three years from the start of 2026, which was seen by Handelsblatt. It lays out the details for the planned scheme, which is set to apply to companies in energy-intensive industry. However, the EU limits state aid to guarantee fair competition, and has yet to agree to the German plans.
To aid the process of state aid approval and allow countries to support companies in international competition in their efforts to move away from fossil fuels, the European Commission in June introduced specific conditions. Among these are guardrails for support for electricity costs for energy-intensive users, for example limiting it to at most half of a company's annual electricity consumption. It also prescribes that companies must invest at least 50 percent of the aid in new clean assets, such as renewable energy generation capacity or energy efficiency improvements.
“It is wrong to render relief measures, which are intended to protect competitiveness, ineffective by requiring mandatory investments in return,” said Philip Nuyken, policy director at the Federal Association of the German Lime Industry.
Handelsblatt wrote that the government’s current concept states that the EU will also not allow companies to benefit from two electricity subsidy schemes at the same time. Industry has called for the EU to allow them to profit from both the “industry electricity price” and the existing power price compensation mechanism, which provides relief from emissions trading costs. The German government plans to allow companies to switch between the industrial electricity price and electricity price compensation on an annual basis, wrote Handelsblatt.
