Germany: EU Commission assesses EEG


A three-sided statement documenting a dialogue between the officials from the Environment and Economics Ministries with top level representatives of the Directorate General for Competition of the EU Commission has thrown a shadow on the German EEG.

According to the local German media "Hansdelsblatt", the EU Commissioner responsible for competition Joaquín Almunia has stated that he will no longer condone the exemption of companies which are electricity-intensive from payment of network charges and implies that companies who have profited from the regulation may even have to pay back the granted exemptions. Almunia had previously been critical of individual privileges to companies in the German energy politics, but not the entire EEG. The statement from Brussels indicates now however that the "total EEG" could qualify as state aid.

Previously, the European Court of Justice had decided that the EEG did not constitute state aid. The legal conditions have changed from that point to now. The EEG could hence be placed under the state aid notification process in the future.

The statement also says that "as a result, complicated corrections of the EEG might be made difficult and be delayed". This would mean that EEG reforms like the adaption of renumeration aids might become more complex. On the other hand the pressure could also mount to completely abolish the EEG and replace it with a quota system.

The EU Commission remains steadfast in its view on the exemption of certain segments of the industry from paying reduced EEG surcharges: it is expected in February next year that the Commission inititates a formal investigation procedure because of the "special compensation scheme" as the Handelsblatt reports.

The scheme which was recently extended was sharply criticised in Germany. Environmental and consumer advocates complained that private households and the middle class would be heavily burdened with the costs of the Energiewende or Energy Transition in Germany. Some sectors of the industry, however, remain unscathed without any burden.

Previously this month, EU Energy Commissioner Günther Oettinger had stated that he sees a need for a "fundamental EEG Reform". He also added that this reform would also only come with rising electricity prices due to the EEG levy or via supply security risks.