Germany proposes grid fees overhaul to better fit renewables

The German network regulator started Monday a formal procedure to rethink electricity grid fees, with the goal of a system that is better suited for renewable energy.

The use of the electricity network accounts for around 20% in Germany's consumer bills. This contributes to the high energy prices in Europe that hurt the economy and industry.

Reform is needed to increase revenue and include more stakeholders in the costs of network expansion. Industry experts claim that the current system lacks incentives to encourage flexible users to reduce peak demands and does not guide energy infrastructure planning through clear price signals.

In a paper released by the regulator Monday, it outlined several suggestions, including making renewable-energy producers pay for the grid costs, which are currently borne solely by the consumers through their bills.

A flat rate or surcharge could be charged based on the size and type of connection of the user, rather than how much electricity they use. The new system uses so-called "dynamic pricing" to determine grid fees based on how busy the network actually is. It hopes to encourage consumers to use their energy more efficiently.

The network agency may establish special rules for better integrating batteries and storage into the system. It gave the public and other stakeholders until June 30 to provide comments on the paper.

The new German government also plans to cut the power tax to a European minimum, and to halve the transmission network fees with the goal of capping the prices permanently.

(source: Reuters)