Electricity costs are set to decrease for many households in Germany, particularly benefiting rural areas in the north and east, as well as Bavaria.

This change comes as a result of a new cost distribution system for the expansion of energy networks, which will see network charges reduced.

These charges, which account for about a quarter of the electricity price, are paid by gas and electricity suppliers to network operators and then passed on to consumers.

The reduction is due to new regulations by the Federal Network Agency aimed at a fairer distribution of the costs associated with the energy transition.

While rural areas with significant renewable energy installations will see a decrease in costs, some urban areas may experience slight increases.

Overall, the changes are expected to provide over two billion euros in relief to consumers.