Grid Fee Exemption for Privileged Grid Use Violating EU Law?

The 3rd Cartel Senate of the Higher Regional Court of  Düsseldorf (OLG) inquired with the European Commission if the exemption of grid charges pursuant to the Electricity Grid Charges Ordinance constitutes a state aid measure in the sense of Article 107 TFEU and was formally investigated by the Commission, OLG announced. The court further informed that the 3rd Cartel Senate will hold hearings in two summary proceedings on 24 October 2012. These cases concern the legality of the exemption for 2011.

According to Section 19 para. 2 sent. 2 Electricity Grid Charges Ordinance (StromNEV), which entered into force on 4 August 2011, end consumers can apply for an exemption of grid charges if the electricity consumption at a delivery point (Abnahmestelle) exceeds 7,000 hours and the consumption at said delivery point exceeds 10 GW. In the opinion of the Federal Network Agency (BNetzA), who has to decide on the requests for grid exemptions, exemptions can be granted retroactively starting 1 January 2011. Acccording to preliminary estimates by BNetzA, grid exemptions for energy-intensive companies will amount to EUR 440 million in 2011 and approximately EUR 1.1 billion in 2012.

The lost grid revenue is passed on to the remaining end consumers pursuant to Section 19 para. 2 sent. 7 StromNEV in combination with Section 9 para. 7 Combined Heat and Power Act (KWKG). Depending on the energy consumption of the final consumer, the surcharge to the electricity costs applies in a staggered manner (see publication of the surcharge for 2012 by the transmission system operators). As levying the surcharge retroactively for 2011 would lead to difficulties with billing, the lost grid fees for 2011 shall be settled with payments to the grid operators in 2013 and later.

In the two summary proceeding, claimants seek preliminary relief concerning the billing method for 2011. There was not a sufficient legal basis for the exemptions, they argue. Besides, the exceptions for energy-intensive companies violated European law, as they constituted illegal state aid measures. A complete exemption of the grid charges was inappropriate, distorting competition because companies with an electricity consumption below the threshold, were not exempted. The law also not intended to exempt retroactively.

In contrast, BNetzA, the respondent, argues that the billing method for 2011 was necessary to avoid unsurmountable difficulties with billing. Due to a lack of a basis for estimates it was reasonable to offset the lost grid charges with the fees for the following years. Besides, StromNEV was amended with the intention to waive the charges for energy-intensive companies as of 2011 because these companies contributed to grid stability due to their large consumption. The public interest in stable grids had to prevail in view of the energy policy shift of 2011 towards a renewable energy supply.

Apart from the two summary proceedings, which will be heard on 24 October 2012, 166 more complaints (principal proceedings) concerning the Section 19 para. 2 sent. 2 StromNEV exemptions and their legality are also pending, OLG informed. Hearings in the first cases will presumably be held in March and April 2013, the court said.

Source: OLG

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