Higher Regional Court of Düsseldorf Ruling on Network-Connected Battery Storage Systems: Implications for Investment Costs and Legal Uncertainty

In its decision of December 20, 2023 (ref. VI-3 Kart 183/23), the Higher Regional Court of Düsseldorf decided that subsidized network operators are not allowed to charge the cost of construction according to the so-called performance price model for the connection. of grid-connected battery storage systems. This regulation could lead to a significant reduction in investment costs for project developers and operators of battery storage systems; However, this initially also causes legal uncertainty as to how and whether building cost subsidies for battery storage will be determined in the future.

The complainant requested that the responsible network operator connect a network-connected battery storage system to the electricity network, i.e. a storage system that does not consume the stored energy itself, but ‘ store electricity from the network and feed it again with it. time delay. The operator of the battery storage system first unsuccessfully appealed to BnetzA against the construction cost subsidy for the network connection requested by the network operator (decision of December 6, 2022 – Ref. BK6 -22-242). The appeal against the BnetzA decision was now partially successful before the Higher Regional Court of Düsseldorf.

Background on building cost subsidies

The legal basis for collecting construction cost subsidies outside the low voltage level is Section 17 (1) EnWG, according to which the grid connection must be made under appropriate economic conditions. Due to the subsidized construction cost, connection users should not oversize their connection capacity; The mains connection should match the connection power used. This is to avoid unnecessary network expansion. The construction cost subsidy therefore has a direction and control role. Only network users on the “exit side”, i.e. consumption connections, are obliged to pay construction cost subsidies, while no subsidy is paid for energy generating plants that feed in. A unique feature of grid-connected battery storage systems is that they operate on both the “output side” and the “feed side”, as they both draw electricity from the grid and bring back in.

The amount of building cost subsidies is calculated regularly according to the one proposed by the BnetzA in a position paper from 2009. Performance pricing model. The service provided is multiplied by the published service price. For large storage systems, this calculation method means that the construction cost subsidy can be an important part of the investment costs.

Decision of the Higher Regional Court of Düsseldorf

In its decision from December 2023, the Higher Regional Court of Düsseldorf decided that it is generally permissible to subsidize the construction cost of battery storage connected to the grid, but that the special characteristics of battery storage must be taken into account in the calculation. Unchanged use of the performance pricing model would be discriminatory and therefore illegal.

The Higher Regional Court of Düsseldorf first decided, contrary to popular opinion in the literature, the collection of building cost subsidies In principle also allowed for battery storage connected to the grid be In particular, this does not contradict Section 118 Paragraph 6 Sentence 1 EnWG, according to which network access fees may not be applied for storage systems for a limited time. The construction cost subsidy is not a network charge within the meaning of this standard. Furthermore, although it follows both from Union law and Section 118 (6) EnWG that storage systems play an important role in connection with the expansion of renewable energy, this is usually not the case. ‘ prevent the collection of subsidies.

However, the calculation of the construction cost subsidy according to the performance price model remains unchanged discrimination within the meaning of Section 17 Paragraph 1 Sentence 1 EnWG and offensive within the meaning of Section 31 Paragraph 1 EnWG. In this case, discrimination is the result of equal treatment of substantially different situations without any reasonable justification. Grid-connected battery storage system operator differs significantly from end user. Unlike the end user, a grid-connected storage system cannot permanently withdraw its connected capacity from the grid. Once the storage system is fully charged, it cannot draw more electricity, but must feed back into the grid first.

The construction cost subsidy does not achieve the same command and control effect for grid-connected storage systems as it does for conventional end-users. Instead, it primarily has a location-control effect, with storage facilities located in areas where they must pay the lowest construction cost subsidy. Battery storage does not have the same effect on network sizes as conventional network customers on the “withdrawal side”, as they can also be operated to benefit the network.

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In the decision, the Düsseldorf Higher Regional Court did not provide any guidance on how to collect the construction cost subsidy for grid-connected battery storage systems, but instead asked BnetzA to do that. In addition, the judgment is not yet final, as the BnetzA has filed an appeal to the Federal Court of Justice against the decision of the Higher Regional Court.

The partial success of the battery storage business before the Higher Regional Court of Düsseldorf therefore presents a lot of legal uncertainty. It is unclear whether and, if so, how the construction cost subsidy will be calculated for future grid-connected battery storage. Subsidies paid up to the decision of the BGH may then have to be reversed. Therefore building cost subsidies should only be paid with a clear doubt that they will be paid back later.