Proposal to Change Green Power Privilege for EEG Reallocation

The Federal Ministry for the Environment (BMU) today also published a proposal to change the so-called Green Power Privilege (Grünstrom Privileg),  an exemption in the Renewable Energy Sources Act (EEG) for utilities that mainly supply renewable energy.

Section 37 para. 1 sentence 2 EEG stipulates that utilities shall be exempted from the so-called EEG reallocation charge if they supply electricity originating for at least 50% from renewable energy sources. The exemption applies to the total electricity supply of the utility, hence also to conventional electricity.  With the EEG reallocation charge, consumers have to pay the difference between market prices for renewable energy and the feed-in tariffs pursuant to the EEG.

BMU proposes to retain the exemption but modify it as follows so as to reduce costs for consumers:

  • The EEG reallocation charge exemption will be reduced to 2.0 Cent/kWh. The current normal reallocation charge is 3.53 Cent/kWh;
  • The amendment shall become effective on 1 July 2011.

The amendment is essential to avoid a further increase of the reallocation charge, BMU argues. In view of the increase from 2.047 Cent/kwh in 2010 to 3,53 Cent/kWh in 2011, it is to be expected that more and more utilities try to benefit from the exemption. This would lead to a higher EEG reallocation charge for the others, as costs would have to be split among fewer consumers. The proposal of a reduced EEG reallocation charge of 2.0 Cent/kWh i roughly equivalent to the charge in 2010. An potential further amendment shall be examined as part of the EEG progress report due on 31 December 2011 (Section 65 EEG).

Source: BMU