They will soon be the biggest item on the electricity bill: around a quarter of the electricity price is accounted for by the costs for the lines that bring the electricity from the power plants and wind turbines to households and companies.

Helmut Bünder

Business correspondent in Düsseldorf.

  • Follow I follow

Now the Federal Network Agency is on the brakes: Because hardly any interest is paid on the capital markets, network operators such as Amprion, Tennet and Eon should be satisfied with lower returns.

After much back and forth, the Bonn regulatory authority finally set the new rates.

For new investments, it will only accept a return on equity of 5.07 percent instead of the previous 6.91 percent.

For the equity tied up in old systems, the permissible return falls from 5.12 to 3.51 percent.

This means that the cuts are not quite as severe as initially feared by the operating companies.

“Investments in the networks remain attractive in the long term,” said Jochen Homann, President of the Authority.

The industry is still appalled and speaks of a “completely wrong signal”.

"This interest rate jeopardizes the efficiency of the network operators and the investments in the network infrastructure that are necessary for climate protection and security of supply," criticized Kerstin Andreae, head of the BDEW energy industry association.

Nevertheless, network costs are likely to rise

The need for expansion is enormous.

The companies are calculating at least 72 billion euros for the high-voltage networks alone, which are to transport green electricity from the north to the south in the future.

The distribution networks to the end customers must also be modernized and strengthened for the energy transition, which costs billions.

Experts therefore expect the network costs for consumers to continue to rise despite the cuts.

“The network operator's returns are paid for by the network users, that is, consumers, industry and commerce.

These must not be unnecessarily burdened, ”said Homann.

The new return on equity also applies to gas pipelines.

Like power grids, they form “natural monopolies”.

So that the operating companies cannot turn the price screw at will due to the lack of competition, the network agency sets revenue caps, which are essentially based on the permissible return on capital.

The new rates apply to gas network operators from 2023, for electricity network companies the cap will apply from 2024.

The Verdi union warned of the consequences for jobs.

“Now the point is that the cost pressure is not dumped on the employees.

We need quick solutions here, ”said Verdi board member Christoph Schmitz.