The probe will test whether exemptions from network charges Germany introduced in 2011 are in effect hidden subsidies, and if that is the case, whether they have distorted competition with companies in other EU nations, the Commission said.
The exemption was estimated to be worth some €300 million in 2012 when it was financed by a €19 surcharge on other electricity consumers.
The Commission said it had "received several complaints from consumer associations, energy companies and citizens alleging that this exemption constitutes unlawful and incompatible state aid."
It said its preliminary view was that the €19 surcharge "may constitute a state resource and that the exemption seems to give the beneficiaries a selective advantage compared to their competitors" in other EU countries.
"This is likely to distort competition within the EU internal market," it said in a statement, adding that it will examine carefully whether the exemptions are justified on common interest grounds and if so, whether this could outweigh the negative impact on competition.
The Commission said it will also examine whether the exemption was financed from state resources in 2011 before the surcharge was imposed.
The opening of the investigation does not in itself prejudge the outcome, it added, inviting German and other concerned parties to comment on the issue.