Planned electricity grid regulations divide energy sector in Saxony

The planned new rules for grid connection in the energy transition have met with a mixed response in Saxony. This is based on feedback from the Saxon Ministry of Energy, grid operators, municipal utilities and industry associations. While some stakeholders warn of investment risks and a slowdown in the expansion of wind and solar energy, others see the proposals as a necessary control measure to limit costs and relieve pressure on the grids.

The background to this is the so-called grid package from Federal Minister for Economic Affairs and Energy Katherina Reiche (CDU). Among other things, it provides for the definition of regions with high levels of green electricity generation. New plants in these regions would no longer receive compensation if they are shut down. The aim is to reduce expensive interventions in the electricity system and to align the expansion more closely with existing grid capacities.

Ministry: Debate "overdue"

"This discussion is necessary and overdue in order to be able to generate and transport sufficient energy in the future and to keep it affordable for all consumers and companies," said Saxony's Energy Minister Dirk Panter (SPD) when asked. At the same time, additional burdens should not slow down the expansion of renewables. According to the ministry, the Free State is lagging behind in the expansion of green electricity compared to the rest of Germany. In addition, grid capacities are already scarce in some regions. This makes it more difficult to connect new plants and companies.

Suppliers and industry warn of investment risks

The Chemnitz-based supplier Eins believes that the potential loss of compensation payments could jeopardize the economic viability of new projects. Projects could be reassessed, postponed or abandoned altogether. Community energy projects - i.e. joint plants with the participation of local citizens - could also become less attractive if costs rise and returns fall. The industry association VEE Sachsen also expects financing to become more expensive and some projects to become uneconomical. The German Wind Energy Association warns of a possible "expansion standstill" in affected regions.

In contrast, approval comes from Leipzig. The municipal utilities there consider the planned instruments to be "largely" a systemic necessity. Frequent negative electricity prices show that the expansion of generation and grids has not been sufficiently coordinated to date.

Effects on electricity prices open

In the short term, lower redispatch costs could reduce the pressure on electricity prices, but in the long term, many stakeholders believe that a lot depends on whether further investment is made in new plants. For Saxony, a "secure, affordable and domestic energy supply" is crucial, emphasized the Ministry of Energy.