Overview

• Germany aims to reduce industrial electricity prices from 16 cents to 5 cents per kilowatt-hour, costing up to €10 billion by 2030.
• The European Commission has flagged the plan as likely violating EU state aid laws, which restrict subsidies that distort competition across member states.
• Several EU countries, including Benelux, Denmark, Spain, Italy, and Austria, oppose the plan, citing unfair advantages for German industries.
• France may emerge as a potential ally, having previously implemented a similar model, though its own scheme expired in 2025 under EU rules.
• The proposal’s future hinges on Germany securing broader EU support and presenting clear evidence of market failure before the Commission’s June reform of state aid rules.