The German Industrial Electricity Price Scheme: Overview and Implications

The industrial electricity price is particularly aimed at companies in the industrial sector with high electricity consumption. A prerequisite is belonging to an industry sector that is classified as being at particular risk of relocation under the relevant European state aid guidelines. The determining factor is the economic activity of the company, which is defined based on industry classification.

In practice, classification often represents a major hurdle. Companies operating in multiple business areas must determine their core activity. This may require early dialogue with statistical authorities or structural adjustments within the company. Companies in financial difficulty are excluded from funding.

The industrial electricity price is granted for eligible consumption points of the applying company, meaning the industry classification must be determined accordingly.

The state support is granted as a discretionary payment and is based on the electricity actually consumed by the applying company. The total amount of aid for a given settlement year is determined upon application as the sum of the basic payment amounts for the individual consumption points of the applicant.

Additionally, there is the possibility of receiving a flexibility bonus. This requires that the applying company invests more heavily in measures that enable flexible adjustment of electricity consumption, such as storage systems or load management. The specific calculation can be complex in individual cases and requires careful preparation of consumption data.

Applications can be submitted annually between March 31 (at the earliest) and September 30 (at the latest) of the application year and must be filed with the Federal Office for Economic Affairs and Export Control (BAFA).

Compliance with these deadlines is crucial, as late applications are generally not considered. There are also additional deadlines related to the submission of supporting documents and the implementation of mandatory investments. Companies should therefore establish internal processes early on to ensure that the necessary data is collected and prepared on time. Accurate recording of self-consumed electricity volumes is particularly important.

The granting of aid is subject to clear obligations. Companies are required to invest a significant portion of the funds received in measures for decarbonization and efficiency improvement.

This includes in particular investments in renewable energy, energy efficiency measures, electrification of production processes, and measures to increase flexibility in electricity consumption. At least 50 percent of the aid must be used accordingly. If the flexibility bonus is applied for, additional requirements must also be met.

In addition, there are extensive obligations regarding proof, documentation, and cooperation with authorities. Failure to comply with these obligations may result in repayment of the granted aid.

The industrial electricity price offers significant economic benefits but is also associated with considerable legal and practical challenges. As a law firm focused on commercial law, we provide comprehensive support in its implementation.

We first assess your fundamental eligibility and support you in the legally compliant classification of your company. We then assist in strategically optimizing the aid, for example by structuring electricity consumption or investment measures.

During the application process, we handle legal support and coordination with authorities and auditors. Finally, we also assist with the implementation of decarbonization measures and with any audits or recovery proceedings.

Our goal is to make optimal use of funding opportunities while minimizing legal risks for your company.