Putting the Debate on the Potential Application of New Grid Charging Systems into Perspective

The discussion as part of the AgNes process shows that we are at a critical regulatory juncture for the continued deployment of utility-scale battery storage in Germany.

First, the positive — and this is important to emphasise: the direction is right. Dynamic grid charges are fundamentally sensible and consistent with how the power system works. Those who put strain on the grid should pay, while those who help relieve it should receive corresponding relief or incentives.

This principle supports the energy transition, makes grid congestion more visible and can help sustainably reduce redispatch costs. The fact that the German Federal Network Agency (Bundesnetzagentur) is broadly pursuing this approach and increasingly recognising battery storage as a system-relevant flexibility option is expressly welcome.

But the specific design is what ultimately matters

One issue was discussed particularly intensively — and for good reason — during the AgNes workshop at the end of January: grandfathering and investment protection. The potential application of new grid charging systems to existing assets remains unresolved. There is no clear decision yet, but the implications for investment and financing certainty are significant.

This is where the greatest risk lies

The energy transition depends on investments being predictable over the long term. If the regulatory framework is changed retroactively to the detriment of investors, or existing exemptions are withdrawn, this effectively alters the conditions underpinning investments that have already been made and can significantly increase uncertainty across the market.

Uncertainty is already high today

Flexible Connection Agreements (FCAs) come with operational restrictions that may be technically justified, but are becoming increasingly complex to assess from an economic perspective. The wide range of potential operating constraints is already making financing more challenging.

At the same time, utility-scale battery storage projects are already fully exposed to market risks — such as volatile market prices and rising cost of capital — without receiving subsidies or capacity payments in return.

If this is compounded by uncertainty over the possibility of retroactive changes to grid charging structures, banks and investors will inevitably become more cautious, increasing the risk that investment capital will move away from Germany. This is particularly problematic because, despite its technological maturity, the utility-scale battery storage market is still in an early development phase, and the current installed base represents only a fraction of the capacity that will ultimately be required.

“Planning certainty for projects was already significantly constrained by the reform of grid charges. The fact that the German Federal Network Agency is now also calling the exemption for existing assets into question represents a new escalation. Trust is not a sufficient basis for investment decisions involving hundreds of millions of euros; accordingly, uncertainty among banks and debt providers is currently substantial. In such a highly regulated sector as the energy industry, this approach sets an unprecedented precedent. It has already caused economic damage and risks further undermining confidence in regulatory commitments.” - Christoph Ostermann.

The real risk:

In the worst-case scenario, Germany could face a persistent battery storage gap in the power system. Not because the technology is unavailable, but because investment decisions are delayed or abandoned. That would represent a systemic setback — precisely at a time when battery storage is needed more than ever to support grid stability, integrate renewable energy and safeguard security of supply.

Our position is therefore clear:

We strongly support dynamic grid charges. Grid- and system-supportive behaviour should be rewarded, while grid impacts should be appropriately priced.

But investment must remain sufficiently attractive and be based on stable and predictable regulatory conditions. If the rules of the game are changed retroactively to the detriment of economic viability, this creates economic damage. Ultimately, the principle is simple: without predictable payback and a viable return on investment, there will be no investment in German infrastructure — and therefore no successful energy transition.

The energy transition requires the courage to change. But it requires reliability just as much.

Without that reliability, momentum turns into stagnation — with tangible consequences for grid stability and security of supply in Germany.