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Germany Targets January 2026 Start for Industrial Power Subsidy Pending EU Approval

Economy Minister Katherina Reiche frames a tightly limited aid plan for energy‑intensive firms as key to shoring up competitiveness.

Overview

  • Reiche said talks with the European Commission are in their final stage and that she expects the discounted power scheme to begin on 1 January 2026.
  • The design must follow EU state‑aid rules allowing up to a 50% discount for no more than half of a company’s consumption with a price floor of €50 per MWh and a time limit of three years.
  • Draft concepts point to a target price around five cents per kilowatt‑hour, with reported costs of roughly €1.5 billion per year or €4.5 billion over three years and potential funding from the Climate and Transformation Fund.
  • Berlin is also seeking to extend power price compensation for indirect ETS costs beyond 2030, with Reiche citing positive signals from Brussels and decisions expected in the coming weeks.
  • The announcement precedes a 6 November steel summit at the Chancellery, as industry groups back swift relief with job and investment conditions and critics warn of costly distortions and weaker decarbonisation incentives.