Germany to compensate power users hit by grid bottlenecks

By BLOOMBERG | 28 November 2023


BERLIN: Germany will entice electric vehicle drivers to charge up when there’s plenty of green power on the system by offering them cheap tariffs linked to wholesale prices.

It’s part of a push by the government to better integrate huge swings of renewable power onto the grid when it’s particularly sunny or windy by ramping demand up or down to match.

It’s an example of the flexible tariffs that are popping up all over Europe aimed at consumers with electricity-hungry devices like heat pumps or cars that can help balance the network.

Europe’s largest economy aims to produce 80% of its power from renewables by 2030, but is struggling to expand its network infrastructure.

To reduce bottlenecks, consumers’ network costs should be reduced by as much as €190 (RM976) per year, or they can opt for a 60% reduction on their energy price and benefit from other levy exemptions for heat pumps, the regulator Bundesnetzagentur said in a statement Monday.

The trade-off is that, if needed, the grid operators can reduce power supplies by an amount that should still enable households to run heat pumps and charge electric vehicles, albeit at a slower pace.

Such intervention is expected to be a last resort, Klaus Müller, the regulator’s president, said in the statement.

From 2025, consumers can also opt for a flexible tariff, a move to help encourage off-peak electricity use and stabilise the system. This requires a quick roll-out of smart meters, which the government has already made mandatory earlier this year.

Other legal and technical questions still have to be clarified, for example the possibility of bi-directional charging, which is when devices like electric vehicles can send power back to their owners’ homes or even the grid.

"We are strengthening consumers’ ability to coordinate reductions independently and to offset self-generated electricity,” Müller said.

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