Incentives prices emissions trading scheme updating
The German state also taxes energy commodities such as heating oil, natural gas, petrol and diesel, as well as electricity.
A complex system of taxes, levies and exemptions is used to make certain energy sources more expensive.
These include grid fees, the renewables surcharge, concession fees, value-added and electricity taxes, making the grid and tax component of German power bills among the highest in Europe.
Installations are included in the scheme on the basis of their Carbon Dioxide (CO2) emitting activities.
Chancellor Angela Merkel’s climate cabinet has taken up the issue and carbon pricing looks set to be part of a programme of measures meant to ensure that the country reaches its 2030 climate targets.
With other European countries (France, the Netherlands, Sweden, Spain) keen to introduce a carbon floor price, pressure is unlikely to subside even in the electricity sector.
The EU ETS - also known as the European Union Emissions Trading Scheme - puts a cap on the carbon dioxide (CO2) emitted by business and creates a market and price for carbon allowances.
It covers 45% of EU emissions, including energy intensive sectors and approximately 12,000 installations.