The pricing mechanism is designed to ensure efficient allocation of scarce resources. This is something you learn in the basic economics course at the local community college. Why our system of industrial network charges has not yet taken this into account is difficult to understand. After all, the authors emphasize that something needs to change. And that the Federal Network Agency has announced a reform. Let’s see in which legislative period an implementation can be expected.

“For a long time, many large consumers of electricity, for example in the paper, chemical or aluminum industry, have received a discount of up to 90 percent on their network charges. The Federal Network Agency has initiated a reform process to revise this regulation. In order to benefit from the subsidy, companies must so far keep their electricity consumption very constant. This also leads to companies artificially stabilizing their electricity consumption, instead of adapting their electricity demand flexibly to fluctuating exchange electricity prices – because if they did, many would lose their network charge discount. And this discount is considerable: This year, the regulation relieves about 600 industrial consumers by 1.4 billion euros, financed by a levy on all other electricity consumers.”

– Lion Hirth, Hanns Koenig and Bernd Weber in “The Reform of Industrial Network Charges is a Good Idea – The Current Regulation is Inefficient, Distorts the Energy Transition and Reduces the Competitiveness of German Companies”, Guest Commentary in Handelsblatt, September 3, 2024, Page 16, No. 170

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