Federal Minister for Economic Affairs, Katherina Reiche (CDU), announced on Thursday that the German industrial electricity price, which was previously approved by the EU Commission, will be implemented without excessive bureaucracy. According to Reiche in a press statement on Thursday, this “industrial electricity price is an important and necessary step for noticeable and swift relief”.
The EU Commission had approved a corresponding subsidy regulation amounting to 3.8 billion euros that same day. Brussels stated that it concluded these measures are “necessary, appropriate, and proportionate” to accelerate the transition to a climate-neutral economy and support various sectors of the economy. Furthermore, because the regulations require companies to reinvest a significant portion of the received subsidies into decarbonization measures, they are expected to aid the journey toward a climate-neutral economy.
Reiche aims to avoid setting specific guidelines for the companies; for instance, possible measures include energy efficiency improvements or investments in renewable energy sources located on the company premises. The CDU politician explained, “We intentionally left the possibilities broad and refrained from making detailed requirements because we cannot assess, and in fact do not want to assess, which measure is suitable on site for 9,500 companies”.
To allow even smaller businesses to take advantage of the industrial electricity price with low barriers, measures are being eased. For example, the requirement for verification by accredited bodies, such as TÜV, is being waived, and audit reports from chartered accountants will only be necessary for companies consuming over 10 gigawatt-hours of electricity annually.
The industrial electricity price is intended to alleviate electricity cost burdens for electricity- and trade-intensive companies across 91 sectors, including areas such as chemicals, rubber and plastics, glass, and semiconductor manufacturing. This measure is set to run from January 1, 2026, through December 31, 2028. Companies can apply for subsidies after the end of each year, once the electricity consumption and the average wholesale market price are known. The target price for this mechanism is set at 5 cents per kilowatt-hour (kWh) and will be determined based on the wholesale electricity price.