Industry association warns against planned grid fee reform
Clean Energy Wire
The German association of energy intensive businesses (VIK) has pushed back against plans to adjust industrial grid fees to incentivise flexible power consumption, saying it risks “overburdening a large part of industry.” In a statement, the VIK stressed that the flexibility potential in industry is limited and not available in every sector and company. At the same time, Germany should maintain the international competitiveness of its industry, the association added, echoing other critics of the plan. “Flexible production processes often lead to deviations from the optimal operating point, which results in higher operating costs and technical inefficiencies,” VIK wrote.
Germany's Federal Network Agency (BNetzA) proposed new regulation to prompt industries with high demand to react dynamically to the current supply of electricity. This means that industrial consumers pay reduced grid fees if they increase demand when electricity supply is plentiful, as well as if they drive down consumption at times of low supply. This is deemed necessary for a power grid increasingly characterised by a high proportion of renewable electricity generation.
Solely focusing on the advantages of a more flexible manufacturing industry for the grid is “too short-sighted and neglects the far-reaching economic effects,” VIK said. The association nevertheless saw an opportunity to increase the existing industrial flexibility potential of energy-intensive companies on a voluntary basis and based on incentives. VIK called for “retaining the existing grid fee regulations and selectively supplementing the existing optional provision of existing and future industrial flexibility potential, thereby creating greater predictability for companies.”
Currently, large industrial consumers receive discounts for maintaining a constant demand for electricity to keep flows in the grid stable and predictable. However, this has been criticised for making it virtually impossible for companies to respond to electricity price signals.
