Abolition of the peak equalization
Only manufacturing companies benefit from the electricity tax cut until 2024
- Electricity tax concessions for parts of the economy
- Energy efficiency is to increase
- Self-generation of energy is becoming even more attractive
The elimination of the top-rate tax reduction for energy-intensive companies is decided. In the course of the industrial electricity price debate, a compromise was reached within the coalition parties in November 2023: Accordingly, the electricity tax will only be reduced for the “producing sector” lowered to the European minimum. The relief package was initially valid up to and including 2025. Companies in the non-manufacturing sectors missed out and have no longer been able to apply for the peak-rate capping since 2024.
Elimination of the peak-load adjustment as part of the electricity pricing package for the manufacturing sector
The cross-industry top-level compensation was originally introduced as part of the 1999 ecological tax reform. Accordingly, energy-intensive companies could submit applications for relief pursuant to Section 10 of the Electricity Tax Act (StromStG) and Section 55 of the Energy Tax Act (EnergieStG), whereby they received up to 90 % in electricity tax refunds. Since 2013, it has been linked to the Federal Ministry for Economic Affairs and Climate Action’s Regulation on the Top-Level Compensation Efficiency System (SpaEfV), after all small and medium-sized enterprises could be relieved, for whom previously no ISO-50001- or EMAS- certification were necessary, but a DIN EN 16247-1 was sufficient.
Since 2025, the 0.05 cent/kWh reduced electricity tax rate for manufacturing companies the peak compensationh.
Criticism of business associations
For manufacturing companies, the electricity price is reduced by the tax cut by around 1.5 cents per kilowatt-hour. For all other business operators, a tax rate of 2.05 cents/kWh continues to apply. Chambers of commerce and business associations criticize that many energy-intensive companies, such as textile cleaning businesses or automotive trade companies, are now excluded from the relief package. With the elimination of the cap compensation (Spitzenausgleich), they no longer have any way to reduce their electricity tax by 0.5 cents/kWh either. For many critics, the overall relief also falls short, as they would have preferred an even more heavily subsidized industrial electricity price. Here, above all, the to mention are the Federation of German Industries (BDI), the German Chemical Industry Association, the Association of the Industrial Energy and Power Industry, and the Association of German Chambers of Commerce and Industry (DIHK).
What does the abolition of the peak compensation (Spitzenausgleich) and the reduction of the electricity tax mean?
Due to the provisional reduction of the electricity tax for the manufacturing sector, far more companies will benefit than would have under a previously demanded industrial electricity price. However, it does not make electricity decisively cheaper, and the duration is still uncertain.
The electricity price compensation (SPK), which was actually supposed to be reduced by 10 % annually, will be extended for another five years. About 350 corporations, including 90 covered by the “Super-Cap,” will benefit from this to ensure their international competitiveness. The compensation is based on emissions trading and aims to offset a portion of the CO₂ costs for certain sectors.
Total relief for companies through the industrial electricity price and SPK is estimated at up to twelve billion euros. Despite a projected total relief, Germany remains among the European leaders in industrial electricity prices even after the electricity tax reduction. The price trends in other European countries and the introduction of the European Carbon Border Adjustment Mechanism could further impact international competitiveness.