BDEW on today's announcement of the 2015 EEG levy:
Various factors influence electricity prices
In many regions increasing network charges are foreseeable / share of electricity price which can be influenced by suppliers is now just 25 per cent.
"The slight reduction in the EEG levy is a welcome development. However, the reduction in the consumer burden is only very marginal. In addition, no general prognosis as to short term price developments can be derived solely from the future level of the EEG levy. Numerous other factors also influence the electricity price. In many regions, for example, continued increases in network charges are to be ex-pected", said Hildegard Müller, Chairwoman of the General Executive Management Board of BDEW today, in reaction to the announcement of the 2015 EEG levy. The levy will fall slightly next year for the first time, from 6.24 cents per kilowatt hour to 6.17 cents/kWh - a reduction of just over 1.1 per cent. However, the future level of other state levies, such as the levy for interruptible loads, has not yet been determined.
In addition to the reduced procurement costs and state burdens, which remain high, network charges are the third most important element of the electricity price. These are checked and approved by state regulatory bodies, in particular in light of cost efficiency. In many regions, the network charges could increase further in the coming year due to the required extension and reform of the distribution and transmission networks, according to BDEW. In the next ten years, as a result of the increase in decentralised photovoltaic and wind energy facilities, investment of around 25 billion euros is required in the distribution networks alone. Existing electricity lines need to be strengthened, new lines need to be laid and substations and other technical facilities need to be installed.
"The significant increase in the electricity price over recent years has mainly been due to rises in taxes, charges and levies. In particular the politicians responsible should stand by their decisions, explain them publicly and not simply shift responsibility for the consequences to energy providers," said Müller. Since 1998, according to BDEW, the proportion of the end consumer price accounted for by state charges has drastically increased to its present level of over 52 per cent. In 2015, the burden on electricity customers from the EEG levy will amount to around 21.8 billion euros. The part of households' electricity price which the distribution com-panies themselves can influence (electricity purchase, distribution) has fallen to around 25 per cent.
"The EEG (German Renewable Energy Sources Act) must be reformed, taking into account the objective of market integration of renewable energies, in order to raise the cost efficiency of the support for renewable energies. The government has set the future course in a significant way through the EEG reform this year. Now, we need to make further steps along this path. To this end, BDEW was the first stakeholder to step forward and present a specific proposal for an auction design for freestanding photovoltaic plants, which ensures the achievement of expansion targets in the area of renewable energies, cost effective support and the largest possible variety of participants", said Müller. "Alongside this, we have to think about a market design to accompany the Energiewende, which enables investment in conventional capacities. The present investment environment is no longer able to do this and is a reason for the growing numbers of applications for closure being filed by German power plant operators. These developments have the potential to endanger the security of supply because renewable energies alone are not able, due to their high degree of dependency on external conditions, to guarantee the electricity supply at all times. Therefore, we urgently need political decisions regarding the preparation of a decentralised capacity market."
Planned publication dates of state elements in the electricity price:
- EEG-levy: Publication on 15 October 2014, effective as of 1 January 2015.
- Offshore liability levy (i.e. EEG-liability levy) according to paragraph 17f of the draft amendment of the German Federal Energy Industry Act: Publication by transmission system operator (TSO) on the basis of paragraph 17 of the draft amendment of the German Federal Energy Industry Act on 15 October 2014, effective as of 1 January 2015.
- Network charges: Publication of projected network charges by the respective network operators by 15 October 2014 - to be finalised by 31 December 2014 - effective as of 1 January 2015.
- New levy for interruptible loads as per Paragraph 9 German Combined Heat and Power Act: Publication by the TSOs and projected announcement on 21 October 2014, effective as of 1 January 2015.
- Levy as per Paragraph 19 (2) German Electricity Network Charges Ordinance: Projected publication by the TSOs on 21 October 2013, effective as of 1 January 2015.
- German Combined Heat and Power Act surcharge: There is no binding date for the publication - if the data is available in good time, the TSOs are aiming for publication at the end of October 2014 - effective as of 1 January 2015.