German Power, Gas Prices Could Rise After Court Grid Ruling

German Power, Gas Prices Could Rise After Court Grid Ruling
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Τετ, 6 Ιουνίου 2012 - 17:49
Retail power and natural gas customers in Germany face rising energy bills after a higher regional court Wednesday ruled that the calculation methods used by the national regulator for power and gas grids are flawed.
Retail power and natural gas customers in Germany face rising energy bills after a higher regional court Wednesday ruled that the calculation methods used by the national regulator for power and gas grids are flawed.

In a written statement, the Duesseldorf-based court said the federal network regulator--the Bundesnetzagentur--has calculated the costs for running and maintaining power and gas grids to the disadvantage of the operators.

For instance, productivity improvement targets have been set too high, it added.

The prospect of rising energy bills due to potentially illegal regulation practices comes as market observers already expect considerable increases in energy prices over the next few years.
Germany has pledged to exit all nuclear energy generation by 2022 and needs to massively expand power grids to ensure rapidly rising volumes of renewables electricity can be shipped to customers.

Depending on the circumstances of the individual operator, the court's decision could result in higher grid access fees in the range of several million euros, the court said. Around 300 German energy utilities across the country had challenged the regulators practices in court.

Grid access fees are the prices operators of power lines and gas pipelines charge other energy suppliers that don't own distribution or transmission infrastructure.

These network charges account for around 25% of retail power prices, so any increase in grid proceeds for the operating companies would result in higher energy bills for customers.

The regulator can appeal the decision but the Bundesnetzagentur declined to comment on the ruling Wednesday, adding that it needs to examine the court's reasoning first.

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