The German state gathered in approximately €417 m from a levy on electricity companies' windfall profits during the energy crisis in the first four months the relevant scheme was in place, the economy ministry (BMWK) has announced in a press release. The scheme applied to profits, above a set margin, generated from December 2022 to the end of June 2023.
“As the spot prices on the electricity market have been declining since the beginning of 2023, the total amount in the first billing period (December to March) was lower than the higher electricity prices in autumn 2022 would have suggested,” the BMWK stated. Germany introduced the scheme in December 2022 to co-fund support measures for consumers during the energy crisis, and announced it would not be extended past 30 June 2023 in view of ‘secure electricity supply, falling electricity prices, and thus a lack of revenue from the levy.’ When the scheme was first aired in September 2022, finance minister Christian Lindner said he expected it to bring a double-digit billion euro sum into the state’s coffers. Revenues generated between April and June will be announced in November.
The perceived need arose because after Russia’s invasion of Ukraine, the profit margins of energy companies with low operational costs multiplied, owing to rising energy prices, while many consumers faced difficulties paying their energy bills. The government decided to collect a proportion of these unexpected gains, which would help co-fund the ‘energy price brakes’, that offered support payments to households and businesses for gas and electricity consumption. Most of the gains made at the height of the energy crisis were not affected by the tax, however, since the measure only included profits generated since 1 December 2022, at which point costs for most energy products had already peaked.
Germany is set to spend much less on its energy price support programmes than expected, as consumer prices remained only a few cents higher than the threshold above which the government would offer payments. According to the economy ministry, the cost to the state of the electricity price brake will amount to approximately €9 bn by the end of July this year, a fraction of the 43 billion originally anticipated.