EnBW launches legal challenge over electricity reserve compensation

20 January 2014 16:09 Source:ICIS

German utility EnBW has mounted a legal challenge against the energy regulator’s ban on the closure of four power generation units with combined capacity of 668MW, the company said on Monday.

Regulator BNetzA made use of its right to prohibit EnBW from shutting down the capacity at the hard coal-fired Walheim units and oil-fired Marbach units in southern Germany because they are considered system relevant. The units would need to stay available for grid balancing purposes until July 2016, BNetzA said.

But EnBW filed a complaint against the decision at the higher regional court in Dusseldorf because it considers the reimbursement system for keeping the plant in reserve as opaque and says it could put the company at a disadvantage against some competitors.

EnBW did not question the system relevance of its units, but said the reimbursement was insufficient. “From a business perspective, this important function of power plants is given insufficient attention in the current legal framework.

“Due to the opaque legal cost reimbursement system, it cannot be excluded that EnBW incurs economic and commercial dis-benefits as a result of the measures ordered in the Federal Network Agency’s ruling of 19 December 2013,” EnBW’s statement said.

“The fact that, according to the law, no compensation is paid during the first year after the application has been submitted is a point worthy of particular criticism,” the statement said.

Also, power plants in southern Germany are at a regional disadvantage because the grid situation has been considered critical in southern Germany since nuclear capacity was removed in 2011, it said.

Power plants deemed system relevant south of the river Main have to remain online despite suffering significant losses, whereas in northern Germany utilities are able to put plants in and out of cold reserve at short notice, and power plants in neighbouring countries are able to offer capacity at market prices.

EnBW’s plants will remain in reserve status for the time being. The number of generation units which German operators want to shut down stood at 30 in November last year ( see EDEM 19 November 2013 ). Sonja Caymaz and Martin Degen

By Sonja Caymaz Martin Degen