The federal government is currently preparing a Energy package with reforms for industry and novellas in the energy sector. According to the current status, the draft laws are to be introduced in the Bundestag after the parliamentary summer recess. The aim is to ensure internationally competitive electricity prices and at the same time incentivize investments in climate-friendly production.
Planned inheritance for industrial electricity costs
At the end of June 2025, the EU Commission, with its new framework for state aid (CISAF), opened up the possibility for member states to grant temporary electricity price subsidies. These are intended to support the transformation of industry towards climate neutrality without creating competitive disadvantages on an international scale.
The German proposal provides for significantly more companies to benefit in the future: the number of subsidized businesses could rise from currently around 350 to up to 2,200. The basis for this is the so-called KUEBLL List energy-intensive industries.
Framework conditions according to EU requirements
- Maximal 50 % Estate to the wholesale electricity price
- Applies at most to 50% of annual electricity consumption a company's
- The effective electricity price must not fall below 50 Euro per megawatt hour sink (for comparison: in 2024, the average wholesale electricity price was around 80 Euros/MWh)
- The funding is for three years limited and must expire by the end of 2030 at the latest
- Only companies in international competition are eligible for funding.
- 50% of the savings must flow into climate-friendly investments
Costs and scope of the electricity cost discount for industry
According to calculations by the Institute of the German Economy (IW), the annual relief amounts to 1.5 billion euros in 2025 and 1.4 billion and 1.1 billion euros respectively in the following two years. This brings the total government subsidies to just under 4 billion euros. All companies with an annual electricity consumption of approx. 20 GWh.
Schedule still open
It is currently unclear when the industry's rebate program can actually start – whether in 2025 or not until 2026. A retroactive implementation would also be possible. The final decision depends on the legislative process and the state aid assessment by the EU Commission.
Energy Law Package with Deficiencies in Grid Connections
With the Energy Law Package and the amendment to the Energy Industry Act (EnWG), the federal government and the Federal Ministry for Economic Affairs and Energy aim to modernize key regulatory frameworks for energy supply. While the reform provides important groundwork for areas such as approval procedures and grid fees, many industry representatives believe one area remains insufficiently addressed: Grid connection conditions for photovoltaic and storage projects.
Critics complain that proposals for Simplification, standardization, and digitalization were not included in the draft of grid connection processes – although concrete concepts already exist for this. In particular, a better Transparency on the utilization of electricity grids as well as mandatory Network capacity reservation options are considered urgently necessary to create planning and investment certainty for project developers while simultaneously avoiding blockages due to unused connection commitments.
Also the missing Uniformity of Deadlines and a hitherto insufficient Penalty option for non-compliance by grid operator are named as weaknesses. Without appropriate adjustments, the expansion of photovoltaics and storage could slow down – with consequences for the energy transition goals and relief in electricity costs.
Further resolutions of the Federal Cabinet in the energy law package
In addition to the electricity price discount and the EnWG amendment, the federal government has decided on additional measures:
- Abolition of the gas storage levy (0.3 ct/kWh) to relieve consumers – Volume around 3.4 billion euros
- Implementation of parts of the EU Renewable Energy DirectiveRED III) with accelerated approval procedures, including for wind power and heat pumps
- CO₂ Storage LawCCS/CCU)first legal basis for the commercial-scale capture, transport, and storage of CO₂
Supplementary electricity tax reduction from 2026 for industry
In parallel, in the context of the Energiewirtschaftsgesetz (EnWG) amendment (Solar package Ia significant reduction in the electricity tax has been decided. From the January 1, 2026 for the manufacturing industry as well as agriculture and forestry according to § 9b StromStG a reduced rate of 0.05 ct/kWh apply. For households as well as small and medium-sized enterprises, however, the rate will remain at 2.05 kWh.
Conclusion
With the planned price reduction for energy-intensive companies, the amendment to the Energy Industry Act (EnWG), and the energy law package, the federal government is setting key course for energy supply in the coming years. While some companies hope for tangible relief in the short term, industry representatives view the impact critically. Even the Association of German Chambers of Industry and Commerce has no great expectations and emphasizes that the discount on the industrial electricity price will not bring about a sustainable improvement, as it only affects a portion of consumption and is linked to additional requirements.