The expansion of the electricity and gas grids required for the energy transition should become more attractive thanks to higher returns for grid operators. In order to offer operators more incentives for investments, the Federal Network Agency intends to increase the return on equity it has set.

It should be 7.09 percent in 2024 and only apply to new investments, as reported by the authority in Bonn. The interest rate is currently 5.07 percent.

The network users, i.e. households, trade and industry, also pay the operators’ returns via the network charges. “The additional burden there must be limited to what is absolutely necessary,” said Network Agency President Klaus Müller.

Experts are assuming that the planned increase in interest rates will increase electricity network fees nationwide by a total of around EUR 500 million per year. For an average household with an annual consumption of 3500 kilowatt hours, this would mean additional costs of 10 to 12 euros per year.

According to the comparison portal Verivox, the electricity network charges for households have risen by 28 percent in the last five years, and the gas network charges by 23 percent. According to Verivox, a model family with a power consumption of 4,000 kilowatt hours and a gas consumption of 20,000 kilowatt hours currently pays a national average of 350 euros net for the electricity grid and 379 euros net for the gas grid per year. Currently, electricity network charges make up 21 percent of the electricity price for households and gas network fees 14 percent.

Rejection by the municipal utility association

The Stadtwerkeverband VKU expressed its opposition to the interest rate put up for discussion. With a view to the required investments, he was “disappointing”, explained the general manager of the Association of Municipal Enterprises (VKU), Ingbert Liebing.

“We need an attractive interest rate in order to be able to raise the necessary capital for the enormous task of expanding the grid. Otherwise, central tasks of the energy transition will fall by the wayside.” At least the past interest rate rises on the capital markets must be fully offset.

The authority has now put its proposals up for discussion. Network operators or associations can comment on this by the end of August. The final determination is to be made at the end of the year.

The grid fee is the price for using the electricity grid. Every network user who draws electricity from the supply network has to pay it to the network operator – similar to postage for letters. According to the Federal Network Agency, the grid fee cannot be formed in free competition because there is only one local electricity grid at a time. Experts speak of a natural monopoly. Therefore, the network fee is regulated.

The grid fees are based on so-called revenue caps set by the authorities. These result from verified costs for the operation, maintenance and expansion of the network plus a profit, the so-called return on equity, as well as annual adjustments. These regulated costs are the basis of the prices that network operators are allowed to charge. The Federal Network Agency emphasizes that the network operator may not earn more from the sum of his network charges than the authority has given him as total revenue.