The European Commission has approved under state aid rules a German proposal to offer reductions on an offshore energy surcharge to electro-intensive users and railways.
Revisions to Germany’s energy laws which will enter into force in 2019 mandate that the costs of connecting offshore wind installations to the electricity grid will by subsidised by consumers, in the form of an offshore energy surcharge.
These amendments to the German Energy Act are intended to create a legal framework for the planning, building and operation of power lines connecting offshore wind installations to the main grid, and the proposed surcharge aims to make this more cost-efficient and encourage uptake.
Part of this new policy will also include a discount on the offshore energy surcharge for railway companies, and certain partners in electro-intensive industries. However, concern was raised that this could potentially interfere with competition in the German energy market, and Germany notified these reductions in offshore energy surcharges to the European Commission for review.
What were the commission’s findings?
The results of the commission’s investigation, which examined the proposal against the EU’s state aid guidelines for energy and guidelines on state aid for railways, found that the measures were aligned with rules and would contribute to the competitiveness of German energy companies without distorting competition in the EU’s single market.
The commission concluded that the reductions offered to electro-intensive users were proportionate, and welcomed the measures for the fact that they would provide a sustainable financing and investment basis of offshore wind installations, without risking competitiveness.
Further, by offering discounts to railway companies, Germany aims to encourage them to shift from diesel-powered trains, which emit high levels of greenhouse gases, to trains powered by electricity. This, the commission argued, would help to fulfil Europe’s ambitious climate aims, and that therefore the new measures are acceptable.
The new legislation was introduced to further Germany’s aim of increasing the installed capacity of offshore wind installations in the country to 6,500 MW before 2020, and to add an additional 8,500 MW before 2030, to reach a total of 15,000 MW.
