Battery storage systems will have to pay for grid expansion, German court rules

Battery storage operators will not be exempt from contributing to the cost of grid reinforcement if it is required for their connection. This was the ruling of a German court hearing a lawsuit brought by a battery storage operator seeking to avoid the additional costs. The court said that while batteries help strengthen grid stability, they should be treated in the same way as other electricity consumers.

As renewable energy continues to expand, Germany is facing increasingly severe cannibalisation, a problem that battery storage could also help address. However, new installations may also require distribution grids to be reinforced to accommodate their connection. Any such grid reinforcement needed to connect batteries therefore entails additional costs that storage operators must pay.

According to Clean Energy Wire, the energy storage industry had hoped for preferential treatment compared with other electricity consumers, such as households and businesses. Batteries can help ensure grid stability through their operation. The outlet reports that one storage operator, Kyon Energy, decided to challenge the obligation to pay the charges in court. These additional costs can account for a substantial share of the total investment required to build storage facilities.

According to the outlet, the German Federal Court of Justice said these costs could have a greater impact on storage operators than on households or businesses that consume electricity, and that batteries are fundamentally different from these consumers. Nevertheless, the court said that treating storage operators on an equal footing with other consumers was objectively justified.

"Although they can ease the burden on the electricity grid overall, battery storage systems do not always benefit the local grid for which the construction cost contribution is charged," the Federal Court of Justice said, according to the outlet.