Premium Tariff (Market Premium)

Abbreviated form of legal source(s)

EEG 2025

Description of support scheme

As of 2025, Germany’s Renewable Energy Sources Act (EEG 2025) continues to grant smaller renewable installations a market premium without competitive bidding. In fact, the auction exemption threshold was raised from 750 kW to 1 MW for most technologies (with an even higher limit of 6 MW for eligible community energy projects). Hydropower and geothermal plants likewise remain entitled to the sliding market premium without any tendering requirements. By contrast, larger projects exceeding these thresholds must participate in EEG tender auctions to determine their support level (the “nominal” tariff) before receiving the market premium. The premium itself is still calculated on a sliding basis as the difference between a fixed reference value (either the statutory feed-in tariff or an auction bid value) and the monthly average market price of electricity. Finally, an operator claiming the market premium is generally not allowed to use the power for self-consumption – all subsidised electricity must be sold to a third party or on the power exchange via direct marketing.

Amount

The amount of the subsidy per kWh is calculated through the difference of a given value (“Anzulegender Wert”) and the energy technology specific market value, which differs according to used technology

Addressees

Plant operators are entitled to receive the market premium for the amount of electricity fed into the grid

Procedure

Power plant operators are entitled to receive the market premium from the grid operators

Competent authority

The Federal Government evaluates the implementation.

Bundesnetzagentur (BNetzA) – Federal Network Agency

Role:

Central authority for renewable energy tenders (auctions) under the EEG.
Publishes auction calendars, administers bidding processes, and awards contracts for projects >1 MW.
Monitors compliance with auction rules and publishes results.

Netzbetreiber (Grid Operators)

Role:

Distribute the market premium to eligible plant operators.
Administer metering, billing, and documentation.

Technologies

Wind energy onshore: Wind power plants with a capacity up to 750 kW are entitled to the premium tariff. Plants with higher capacity must participate in the tendering procedure (§ 22 EEG 2021).
Pilot wind power plants on sea and a total amount of 125 MW of electricity from pilot wind power plants on land will be subsidised outside the tendering procedure (§ 22 par. 5 EEG 2021).
Wind energy offshore: Wind power plants with a capacity up to 750 kW are entitled to the premium tariff. Plants with higher capacity must participate in the tendering procedure (§ 22 EEG 2021).
Pilot wind power plants on sea and a total amount of 125 MW of electricity from pilot wind power plants on land will be subsidised outside the tendering procedure (§ 22 par. 5 EEG 2021).
Solar energy: Solar power plants with a capacity up to 750 kW are entitled to the premium tariff. Plants with higher capacity must participate in the tendering procedure (§ 22 EEG 2021).
Geothermal energy: Eligible
Biogas: Biogas is eligible for the premium tariff and is defined as any gas obtained through anaerobic fermentation (§§ 3 and 19 EEG 2021). Biogas plant operators producing electricity from landfill waste and sewage must fulfill the requirements of a highly efficient heat and power cogeneration (§ 44b EEG 2021).
Hydro-power: Eligible
Biomass: Biomass is defined in the biomass directive (BiomasseV 2001). Biomass plants with a maximum capacity of 150kW are eligible. Biomass plants that are already in use must participate in the tendering procedure (§§ 30 and 39g EEG 2021). Biomass plants must fulfill the requirements of a highly efficient heat and power cogeneration, except if they can prove that it would not be economically feasible (§ 39 par. 3 EEG 2021).