Mechanisms of action of the new statutory energy price brakes for electricity, natural gas and heat

The Electricity Price Brake Act (StromPBG) and the Natural Gas Heat Price Brake Act (EWPBG) came into force on 24 December 2022.

Since the end of 2021 at the latest, energy prices have risen sharply. Not least the Russia-Ukraine war has further aggravated the situation. The federal government has therefore taken various measures to relieve the burden on end consumers (relief packages).

Two of these relief measures consist of capping the price for electricity, for grid-bound natural gas and for heat by means of statutory price brakes for end consumers. In doing so, final consumers are promised a certain price cap, i.e. if the contractual price with the energy suppliers is above this cap, the supplier has the obligation to cap the price at the legal cap. However, this price cap does not apply to the total amount of energy required, but only to a large part of the annual demand, so that an incentive to save energy remains.

To partially finance this relief, so-called surplus revenues are skimmed off certain electricity generation plant operators and - via the companies involved in transmission and supply - passed on to the final consumer. Deficits in financing are compensated by the federal government. Surplus revenues are those that exceed the "standard profit" set by the legislator for each type of plant, i.e. those that the plant operator could not have expected. Of these surplus revenues, after correction by the result of hedging transactions, 90 % are skimmed off and paid to the grid operator.

We provide clear answers to the following questions in the documents available for download on this page:

• Who is affected by the price brake for electricity, natural gas and heat?
• For what period do the price brakes apply?
• With which amounts and for which quantities do the price brakes apply?
• What is the effect of the different ceilings, especially in the group of companies?
• How does the rolling mechanism work?
• What information obligations exist for the companies primarily affected on the one hand and for the companies involved in the rolling mechanism on the other?
• What are the follow-up obligations for the companies claiming relief?

In the documents linked on this page, we illustrate the basic mechanisms of the electricity price brake and clearly show the connection to surplus revenue absorption for electricity generation plant operators. The less complex price brakes for natural gas and heat are also presented.