Ordinary Ledger: 1.95 cents a kilowatt-hour, about €5 billion a year, and a week to find it

There is a line on your electricity bill that has nothing to do with power stations or wires: the electricity tax. For households it is 2.05 cents per kilowatt-hour¹. Since last year, manufacturers and farms and forestry businesses pay less; households and most other businesses do not¹. Chancellor Friedrich Merz wants that changed. “It is an unpleasant subject, I say that quite openly,” he told the Berlin chamber of commerce on Tuesday, adding that cutting it for everyone would cost “about five billion euros” a year in lost revenue, “but we should do it”¹.

The ledger. - Electricity tax today: 2.05 cents per kWh; the EU minimum the government is discussing: 0.1 cents¹. - Cost to the budget, per the chancellor: about €5 billion a year¹. - ARD’s estimate for households: roughly €5 to €10 a month less, depending on size and consumption¹. - Average price for an electricity contract a household can sign today: 40.1 cents per kWh, 2.9 cents or 8% above the start of the year, according to the energy industry association BDEW². - Desk arithmetic: the cut is 1.95 cents net. With 19% VAT on top, about 2.32 cents per kWh. For a household using 3,500 kWh a year, that is about €81 a year, or €6.77 a month, if passed on in full. The full tax with VAT, about 2.44 cents, is roughly 6% of that 40.1-cent price.

The other side of the table. Finance minister Lars Klingbeil says he sees “no new room” in the 2027 budget¹. SPD parliamentary leader Matthias Miersch says everyone would like to do it, but the question is how to finance it “reliably and soundly”¹. Andreas Mattfeldt, a CDU member of the budget committee, says savings could be found, mainly in the climate and transformation fund, but would not name items, and says nobody from the government has yet approached him¹. The committee ties up the 2027 package next Thursday, 12 November¹. Merz says he has “a few ideas” and that they will be discussed this week¹.

What it means for you. Nothing changes on your bill today. If you are on a running contract, BDEW says the recent rise in prices for new contracts has not yet reached you². The useful habit is the dull one: when the January letter arrives, look at the cents per kWh, not the monthly instalment, and check whether any tax change is in it.

The constructive point is that this argument is happening in the right place. A tax cut that has to find €5 billion in a budget committee is slower than one announced at a lectern, and much more likely to still be there in March. Nothing here is investment advice.