On behalf of its client Stadtwerke Crailsheim, the law firm Becker Büttner Held (BBH) had a fundamental issue of the energy industry clarified by the Federal Administrative Court (Bundesverwaltungsgericht – BVerwG). In its ruling, the court confirmed today that it is the concession area which is decisive for determining the default supplier of a particular area.
Since the introduction of the statutory regulation on the determination of the default supplier in 2005, operators of general energy supply grids are obliged to determine the default supplier for the next three calendar years every three years. The reference date for the current determination was 01/07/2021. Pursuant to sec. 36 subs. 2 sentence 1 German Energy Industry Act (Energiewirtschaftsgesetz – EnWG), the default supplier is “the energy supply company which supplies the majority of household customers within a grid area of general supply”. What this “grid area” refers to has, however, remained controversial – to this day.
According to the Federal Administrative Court, the relevant reference point for determining the geographical scope of the grid area is not the area of the municipality or the entire grid area supplied by a company but the respective concession area. The clarifying court ruling arrived just in time as the time-limit for raising objections against the current determination of default suppliers expires on 31/10/2021.
BBH partner Dr. Michael Weise and partner counsel Dr. Anna Sachse, who represented Stadtwerke Crailsheim against the Federal State of Baden-Württemberg before the Federal Administrative Court, welcome this clarification for the industry.
“At long last, we have a clear definition of the term ‘grid area of general supply’. Especially in light of the current developments on the energy market, the question of the competent default supplier is, in fact, becoming an increasingly sensitive issue,” says lawyer Dr. Michael Weise.
With its ruling, the Federal Administrative Court stresses the idea of competition also with regard to default supply. The reference to the concession area allows energy suppliers to act as the default supplier also in grid areas other than their own.
“The court’s interpretation may, however, produce the somewhat surprising result that there can be several default suppliers in a single municipality, particularly where municipalities are incorporated into other municipalities,” explains lawyer Dr. Anna Sachse.
It will be very interesting to see how the industry responds to this ruling.
Becker Büttner Held is a leading provider of advisory services for energy and infrastructure companies and their customers. Energy and supply companies, particularly public utilities, municipalities and local authorities, industrial companies and international groups are among its core clients. BBH advises these and many other companies and organisations in all legal matters and also assists them with business and strategic advice.
Contact:
Prof. Dr. Ines Zenke
Lawyer (Rechtsanwältin), Partner
Phone +49 (0)30 611 28 40 - 179
ines.zenke@bbh-online.de
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