Germany plans to bring forward phasing out of EEG surcharge amid high energy prices

German EEG Supplement (Umlage EEG) was to be phased out in 2023 at the earliest, but in the context of rapidly rising energy prices, the federal government is considering bringing forward the reform.

Umlage EEG could be scrapped sooner rather than later

In a bid to relieve consumers, who are struggling with Germany’s soaring energy costs, the ruling parties of the traffic light coalition are considering the possibility of scrapping the EEG surcharge – a tax on the price of electricity used to finance the expansion of green energy energy systems of the Federal Republic – sooner than originally planned.

FDP parliamentary group leader Christian Dürr said dpa that the coalition partners wanted to get the measure off the ground as soon as possible, with talks penciled in over the next two weeks. “The high tax burden and rising inflation are increasingly becoming a problem for consumers,” he explained.

His fellow FDP party member, Lukas Köhler, added: “In the current tense situation, the abolition of the EEG surcharge would represent quick and unbureaucratic help that would quickly reach people and businesses… We in the firelight coalition circulation, are determined not to leave people alone with the problem of rising energy costs.

The move is expected to save German households 300 euros a year

In their coalition agreement, the SPD, Greens and FDP parties previously agreed to phase out the EEG surcharge from January 1, 2023, in order to shift the burden of financing the switch to green energy from individual consumers to the federal government. According to the Minister of the Economy, Robert Habeck, this decision should allow an average household to save around 300 euros per year.

The government is also promising additional financial assistance to help those struggling with rising utility bills. Finance Minister Christian Lindner has already set aside the necessary funds to provide all housing benefit recipients in Germany with a subsidy for heating costs.

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