Fotolia.com/Jürgen Fälchle

© Fotolia.com/Jürgen Fälchle

The Federal Cabinet today took note of the draft ordinance on the average price of electricity tabled by the Federal Economic Affairs Ministry. The ordinance brings the method used to calculate the relevant electricity costs under the Special Equalisation Scheme into line with the requirements set out by the European Commission. This new method will be based on average electricity costs.

Under the Special Equalisation Scheme, companies with high electricity costs receive a reduction on their renewable energy surcharge. This ensures that the companies remain internationally competitive and that good jobs are retained in Germany. Companies are considered as electro-intensive if their electricity costs make up a particular share of their gross value added. Up to now, this was determined based on the actual electricity costs paid by the particular company. In future, average electricity prices of companies with high electricity costs will be calculated for groups of similar electricity consumers and these average figures used. This means that electricity costs will be calculated on an objective basis.

The ordinance will enter into force in February. The Federal Office of Economics and Export Control will publish the average electricity prices for 2016 on its website no later than 29 February. This will provide clarity for the companies affected as to what average electricity prices will be taken as a basis for determining their electricity-cost intensity - before this year's application process starts.