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    German energy regulator to study power grid returns

    May 22, 2023 - Zawya


      FRANKFURT - Germany's federal network regulator plans to study the permitted returns on infrastructure for power networks through to 2029 to take account of inflation and expansion plans by grid operators to accommodate renewable energies.

      Klaus Mueller, president of the regulatory agency, the Bundesnetzagentur, said at a conference in Essen on Monday that the study would consider inflation and interest rates and be carried out in consultation with operators.

      Power grid companies including E.ON and EnBW have said they need more money to remain competitive when billions of euros must be spent to accommodate more wind and solar power production plants on the grids.

      Mueller stressed he has to balance the need not to overburden consumers, who help to finance operators' investments through grid fees which make up 20% of power bills, with the need to incentivise operators and institutional investors.

      "We will be objective and fact-oriented, neither will we allow ourselves to be pushed, nor are we too slow," he said, adding the results will be published and made available in a timely manner.

      The Handelsblatt daily business paper cited Mueller in its Monday edition as saying that adjustments for reduced rates from January 1, 2024, were being considered.

      In 2021, the permitted future returns for new power and gas infrastructure were set at 5.07%, versus 6.91% now. The rate is applicable for five years from 2024 for power and from 2023 for gas.

      Rates for old infrastructure were set at 3.51%, down from 5.12%. The gas sector for its part must shoulder the transition to more liquefied natural gas (LNG) feeds and wider adoption of renewable hydrogen to replace fossil gas.

      (Reporting by Vera Eckert and Tom Kaeckenhoff, editing by Sharon Singleton)


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