VKU and ZVEI call for fairer electricity cost relief

18.03.2025

Source: E & M powernews

A report commissioned by VKU and ZVEI shows that the planned subsidies for grid fees are unevenly distributed. The associations are calling for fairer relief.

The debate about reducing electricity prices in Germany is gathering pace. While subsidies for transmission grid fees (TSOs) are being discussed as the main measure, the German Association of Local Utilities (VKU) and the German Electrical and Digital Manufacturers' Association (ZVEI) are warning against focusing too one-sidedly. A report commissioned by them from the consulting firm Consentec shows that a fairer distribution of the relief would be necessary.

So far, there are plans to partially reduce transmission grid fees to ease the burden on electricity prices. According to VKU and ZVEI, this is not enough to achieve the political goal of reducing electricity costs by 5 cents/kWh for all consumers. Small and medium-sized enterprises (SMEs), craft businesses and private households in particular would benefit less from this measure than large consumers, according to the associations with reference to the brief report produced.

This shows various alternatives: In addition to subsidizing the TSO grid fees, the grid fees of the distribution grid operators (DSOs) or the so-called grid-related levies - such as the surcharge for special grid usage and the offshore grid levy - could also be reduced. Such a combination could help to distribute the relief more fairly across all consumer groups.

Conceivable: Financing from CO2 pricing

Another topic in the debate is the financing of the subsidies. In 2023, the German government had already made funds available due to the energy price crisis to compensate for the sharp rise in the TSOs' congestion management costs. However, a similar subsidy for 2024 was canceled at short notice for budgetary reasons. It is now being discussed whether revenue from carbon pricing could be used to provide further relief. These funds could either be used to directly reduce grid charges or alternatively for a general climate charge for citizens.

VKU Managing Director Ingbert Liebing emphasized the importance of a fair distribution of the relief: "We need the acceptance of the entire population for the energy transition. Unequal regional relief could deepen the social divide." Wolfgang Weber, Chairman of the ZVEI Management Board, also demanded that the goal of reducing electricity prices for all consumers must be achieved in order not to slow down electrification in areas such as electromobility and heat pumps.

In order to really achieve the political goal of a five cent lower electricity bill per kilowatt hour, additional funds are required. The 6 billion euros in subsidies planned so far would not be enough, the associations warn. A fair distribution of the burden between transmission and distribution grid operators and greater inclusion of grid-related levies are urgently needed.

VKU and ZVEI are therefore calling for the German government to take a broader view of the issue and not just focus on the transmission grid fees. A broader solution could provide fairer relief for all consumer groups.

The 23-page short report "Options for reducing grid fees for electricity distribution grids through a state subsidy" can be downloaded from the VKU website.

Author: Davina Spohn