German Energy Firm in Talks With EU Over Throttled Power Flows

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By Eleanor Tyler

German electricity company TenneT TSO GmbH faces allegations from the European Commission that it throttled Danish electrical capacity entering Germany on its transmission network.

The EU and TenneT are “in constructive discussions to design a set of commitments” to address EU concerns, according to March 19 statements from both the EU and TenneT. “As part of this collaboration,” TenneT said it has developed “concrete solutions and will submit them today to the commission.”

The EU’s competition commission opened a formal investigation into TenneT’s capacity curbs, saying they were an “abuse of dominance” on the German power market. TenneT is the largest of the four German transmission system operators that manage the high-voltage electricity network.

Bloomberg News reported in June 2017 that the German-Danish dispute had become a key friction point in the EU goal of creating a single energy market, with Germany’s surges of renewable energy and congested internal grid causing conflicts with neighboring grids.

Clarity Needed

TenneT said it views the investigation as a positive development. It provides an “opportunity for a legally secure interim solution” while the company waits for a new electricity trading framework to enter into force.

Today’s capacity calculations, used to address the bottleneck at the German-Danish border and at other grid interconnections throughout western Europe, need more clarity under the law while the EU works on the framework for the “Clean Energy Package,” TenneT said.

TenneT spokeswoman Ulrike Hörchens told Bloomberg Law that transport capacity between Germany and Denmark has grown scarce as a result of “market liberalization and the energy transition” to renewable sources and a more common grid.

The Danish-German border isn’t unique, she said. Bottlenecks have developed at many borders in Europe. “We have noticed that the available transmission capacities are declining for roughly the past five years,” she said.

TenneT has been independently working on the problem, she said, and has deployed “numerous measures” with the Danish transmission system operator Energinet “to utilize the cross-border lines optimally.”

TenneT and Energinet agreed in mid-2017 to gradually increase transmission capacity between Germany and western Denmark with a goal of increasing minimum capacity to 1,100 megawatts in 2020, equivalent to 62 percent of the connection between the two countries, up from 11 percent in 2016.

The commission will vet the remedies TenneT proposes with other market participants.

To contact the reporter on this story: Eleanor Tyler in Washington at etyler@bloomberglaw.com

To contact the editor responsible for this story: Fawn Johnson at fjohnson@bloomberglaw.com

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