“The Energiewende can only work with modern and efficient grids”

Karlsruhe. The Federal Network Agency plans to define the future rate of return on capital for electricity and gas grids in the next few days. In advance of this announcement, Member of the EnBW Board of Management Dirk Güsewell is once again urgently advocating for a reexamination of the rates of return currently under discussion: “The Energiewende can only work with modern and efficient grids. The achievable returns for companies and the capital market must therefore be able to compete with other investment opportunities. including those available internationally.” According to calculations made by the EnBW Group, this means, however, that the value of 4.59 percent suggested by the Federal Network Agency for new plants must be at least 1.6 percent higher.

“It is only at first glance that a lower level of return will deliver savings for consumers. It will prove expensive in the medium to long term and make the restructuring of the energy system, sector coupling and ultimately the achievement of our climate goals impossible,” explains Güsewell, who is responsible for System Critical Infrastructure on the Board of Management. In the coming years, the EnBW Group – which includes various transmission and distribution grid operators – intends to invest tens of billions of euros in the German grid infrastructure.

Güsewell emphasizes that in principle the process being followed by the Federal Network Agency will still allow the necessary scope for some adjustment before the rate of return is finally set in stone. A key starting point would be to correctly calculate the so-called the market price premium based on economic conditions. It has been undervalued in previous calculations and has meant that the rate of return on equity is far too low – also when compared with other countries. According to a study commissioned by the EnBW distribution grid subsidiary Netze BW, the rate of return would be at least 1.6 percent higher if calculated correctly. “In our opinion, this is the right starting point for securing the future of the grids,” emphasizes Dirk Güsewell.