Germany: Bill on Subsidy for Reducing Network Access Fees in 2026

Why should I read this?

The German Federal Government has adopted a bill for mitigating electricity costs for all power end users by subsidizing transmission grid costs in 2026. If the bill becomes law, transmission grid fees, which are a significant component of public network access fees and thereby of electricity costs, will be reduced by way of a direct subsidy of €6.5 billion. The Government will use funds from the Climate and Transformation Fund (Klima- und Transformationsfonds – KTF) for this subsidy and distribute them to the four transmission system operators (TSOs) which have responsibility for a control area (Regelzonenverantwortung), i. e. the companies 50Hertz, Amprion, TenneT and TransnetBW.

What do I need to know?

The draft will introduce a new § 24c into the Energy Industry Act (Energiewirtschaftsgesetz - EnWG). Key provisions include:

• Entitlement of TSOs: The TSOs will receive a total of €6.5 billion in 2026, payable in ten equal monthly installments from February to November.
• Allocation: The subsidy will be distributed proportionally based on the revenue cap of each TSO in relation to the sum of revenue caps of all TSOs.
• Impact on grid fees: The TSOs will have to deduct the subsidy from their revenue caps when they calculate transmission grid fees. These revenue caps have been imposed on the TSOs in the course of the yardstick, or incentive, regulation (Anreizregulierung) of network access fees.

The TSOs have to calculate their network access fees, as limited by the revenue cap, which the subsidy should reduce further, according to the rules set by the Ordinance on Power Network Fees (Stromnetzentgeltverordnung) and without discrimination against network users.

Network access fees charged by (downstream) distribution network operators to a power user include the fees for use of the upstream (transmission) networks, then reduced altogether by €6.5 billion. The subsidy paid to the TSO will therefore result in a reduction of the grid fees for all network users and thereby for all end users of power which use the public grid.

• Oversight: The Federal Network Agency (Bundesnetzagentur - BNetzA) will oversee the correct application of the subsidy.

The TSOs are obliged to fix network access fees for the next year and publish them no later than 15 October of a given year. Business associations have already raised concerns that the bill may be voted in Parliament too late for that date.

What does this mean for stakeholders?

The Government expects reduced network access fees and power bills of 1.3 ct/kWh. While companies and consumers will be appreciate this relief, hopes for a reduction of about 5 ct/kWh, as aimed at in the Coalition Agreement of the present Government, have not yet come true. Electricity tax (Stromsteuer) will in parallel be reduced for agriculture, forestry and manufacturing businesses.

Nevertheless, costs for energy, namely power, will remain high in Germany.

What should I do next?

Once Parliament has voted, power end-users may wait for the network operators to implement the grid fee reduction and for their power suppliers to pass on reduced network access fees. The reduction is limited to the year 2026. As the Federal Government has announced it will implement special reduced power prices for manufacturing businesses in general (Industriestrompreis), it will be worthwhile for large power consumers to monitor the political process further, possibly to act with respect to the political level and engage with business associations, Government and members of Parliament, that plans for reducing the costs for power are further pursued.