Surcharge for renewable energy rising in Germany

BERLIN: Germany’s surcharge for renewable energy will rise by almost half next year, a government source said, intensifying the burden for consumers from the country’s shift away from nuclear power.
The 47 percent increase reflects the fact that renewable sources are providing increasing amounts of electricity, which is bought from producers at guaranteed prices above market rates.
Coming a year ahead of a federal election in which Chancellor Angela Merkel will seek a third term, the sharp rise in the surcharge is politically charged.
The so-called ‘Umlage’ — charges levied on German consumers to support renewable power — will rise to 5.3 euro cents per kilowatt hour (kWh) in 2013 from 3.6 cents in 2012, the source said.
The four leading high voltage network operators (TSOs) are scheduled to officially release the increase on Oct. 15, based on their forecast of renewable power production in 2013.
They are 50Hertz, owned by Belgian Elia and Australian fund IFM, E.ON’s former high voltage grid unit TenneT, RWE’s former unit Amprion, and EnBW’s grid unit TransnetBW.
All four operators declined to comment on the news.
Under German law, green power from sources like wind and solar must be fed into the electricity grid and paid for at above-market rates in a system partly administered by the TSOs.
The renewable surcharge covers the difference between guaranteed prices paid for renewable energy and market prices for conventional energy.
German media has been highlighting the cost to households of Merkel’s decision last year to speed up the switch to renewables and switch off nuclear plants earlier than planned.
Opposition parties have accused the government of letting private consumers bear the brunt, after it exempted energy-intensive heavy industry from green energy and network usage tariffs.
Internet portals which monitor prices for German consumers said the surcharge move will hike household power bills by more than 7 percent next year.
“The next letter from the power utility should bring unhappy news for most household customers,” said portal Toptarif.
Rival portal Verivox said an average household using 4,000 kWh per year would likely pay 1,070 euros ($ 1,380) in 2013 compared with 997 euros now.
In addition, consumers stand to be charged value-added tax (VAT) and probably higher fees for network usage passed on to end users by utilities, Verivox said.
Together with a rising burden from footing the bill for the industry exemptions, retail prices might actually rise by 11 percent, which would be biggest jump seen in 10 years.