Federal Cabinet Adopts Bill Amending Laws Regulating Power Line Expansion

Yesterday the Federal Cabinet adopted a bill amending various laws concerning power line extension. The main aspects are an extension of the annual obligation to evaluate the need for grid expansion to a two-year period and more possibilities to install underground cables.

1. Extension of the Period to Evaluate the Need for Grid Expansion

a) Current System and Timeframe

Sections 12a et seq. EnWG (German Energy Act) lay down a complex three-step process for the evaluation of the need to optimise, reinforce and expand the electricity grids. This includes the annual obligation for  the transmission system operators (TSOs) to prepare a scenario framework that comprises at least three scenarios describing the possible grid developments (cf. Section 12a EnWG) and onshore and offshore grid development plans (so-called NEPs) based thereupon (cf. Sections 12b and 17b EnWG). The scenario framework and the NEPs have to be consulted with the public and approved by the regulator, the Federal Network Agceny (BNetzA). At least every three years BNetzA has to submit the NEPs to the federal legislator (cf. Section 12e para. 1 sent. 1 EnWG). They serve as drafts for the “Federal Requirement Plan for Transmission Networks” (Bundesbedarfsplan Übertragungsnetze; regarding the first such plan, please see here).

b) Reasons for Changes and New System

The complexity of the system with its public involvement causes time overlaps, the bill says. It proposes to require TSOs only to submit scenario frameworks and NEPs every two years. Every other year they shall have to submit a report on the progress of the implementation of the NEPs. BNetzA shall be required to submit the NEPs every four instead of every three years to the legislator.

2. Extended Possibilities to Install Underground Cables

Two laws currently regulate the installation of underground cables by naming pilot projects

  • The Energy Line Extension Act (EnLAG)
  • The Act on the Federal Requirement Plan (Bundesbedarfsplangesetz – BBPlG)

Both laws try to speed up transmission grid expansion by determining the necessity and urgency of the projects listed with binding effect for the planning authors (cf. Section 1 para. 2 EnLAG and Section 12e para. 4  EnWG for BBPlG projects).

The proposed bill

  • Extends the criteria for the installation of underground cables in the EnLAG;
  • Lists more pilot projects in the EnLAG and the BBPlG;
  • Stipulates that an installation of underground cables is also possible if the criteria for an installation are only fulfilled for a section of the entire power line;
  • Extends the term “underground cable” to comprise other technical options for underground installation (cf. explanatory memorandum, page 3 of the bill)

Regarding the extra costs for underground cables the explanatory memorandum gives only an indication as it cannot be specified at this point how many kilometers of new underground power cables will eventually be installed. It states that currently 4 EnLAG underground cable projects with a total length of 30 km are carried out. If another 30 km were laid as part of the new pilot projects envisaged by the amendment, this would lead to additional costs of “roughly EUR 200 million”, the memorandum says (cf. page 6). The calculation is based on costs for 30 km of overhead power cables of EUR 1.4 million per kilometer multiplied by the factor 6 for extra costs caused by underground cables (30 x 1.4 x 6 actually equal EUR 252 million).

The memorandum also contains interesting information regarding the state of play of German grid expansion (cf. page 19). Of the 1,877 km of power lines pursuant to EnLAG that constitute the so-called “starter grid” (Startnetz) of the grid development plan, 436 km have been finished. By 2016 TSOs expect about 40% of the EnLAG power lines to be completed. BBPlG projects have not started yet, but BNetzA has received the first applications for federal planning (for further information, please see here).

3. Next Steps

The bill will now undergo the parliamentary process, including readings in the Bundestag and review by Bundestag committees, as well as review and vote by the Bundesrat.

Source: Federal Ministry for Economic Affairs and Energy

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