1. Review of the ElWG Package by 23 February 2024
On 12 January 2024, the so-called "ElWG Package", which includes
- a federal act regulating the electricity industry (Electricity Industry Act - ElWG),
- afederal act defining the concept of energy poverty for statistical purposes and to determine target groups for support measures (Energy Poverty Definition Act - EnDG) and
- amendments to the Energy Control Act
was submitted for review as a ministerial draft. The document number in the Federal Legal Information System (RIS) is:
BEGUT_98A64318_7EC0_4A83_9396_B69707E01C9D
The review period expires on 23 February 2024. According to the press statements by the Federal Minister in charge, Ms. Gewessler, a government bill should then be adopted fast and the package should be submitted to the National Council so that it can be passed quickly with the required two-thirds’ majority during the current parliamentary term.
Interestingly, a working group bringing together representatives from ministries, the social partners and the energy sector was set up concurrently with the beginning of the review period; it is to develop a new model for basic supply, which has recently been the subject of much discussion (the Constitutional Court's review decision of 13 October 2023, G 122/2023-19 being only one case in point), with special consideration for low-income households (social tariff). Reportedly, "further developments" in the requirements for price changes by electricity suppliers (which are equally controversial at present) will also be discussed there.
This already goes to show that the draft will (have to) be massively supplemented and that it is definitely not the last word in respect of important issues, including the fact that the Electricity Industry Act is intended to create uniform federal rules for the entire electricity market (no longer requiring the 9 implementation acts stipulated under Art. 12 par. 1 sub-par. 2 of the Federal Constitutional Act) – something that raises questions even upon first perusal of the draft. Various provisions (such as sec. 29, 58, 67 par. 1, 68, 93 and 151 of the ElWG - cf. sec. 1 ElWG) are still designed as fundamental federal provisions although the drafting history explicitly states with regard to sec. 1 ElWG that a competence clause of constitutional rank is to be drawn up in order to enact the provisions as directly applicable federal law. Why exactly it should not be possible to enact the provisions stated in sec. 1 ElWG as directly applicable federal law is not systematically clear, at least at first glance.
Nevertheless, we would like to provide a brief overview of the contents of the ElWG package:
2. Contents of the ElWG Package
a) Contents of the ElWG
- Subject area: Control block/control area and balancing groups:
- Definition of control area, control block and control area manager in implementation of Regulation (EU) 2017/1485 (System Operation Guideline - SO GL)
- Consolidation of the tasks of the balancing group coordinator with those of the control area manager with an option of partial or full delegation of tasks to a third party in implementation of Art. 13 of Regulation (EU) 2017/2195 (Electricity Balancing Guideline - GLEB)
- Subject area: Rights of end customers:
- Comprehensive information and notification obligations
- Right to supply contracts with dynamic energy prices (implementation of Art. 11 of Directive (EU) 2019/944)
- Right to an aggregation contract (implementation of Art. 12 of Directive (EU) 2019/944)
- Right to use a prepayment meter
- Right to good customer service and proper complaint management (implementation of Art. 10 (9) of Directive (EU) 2019/944)
- Comparison tools for the supply and purchase of electricity ("tariff calculator") (implementation of Art. 15 of Directive (EU) 2019/944)
- Subject area: Intelligent measuring devices ("smart meters"):
- Right to be (prematurely) equipped with a smart meter
- Shortening of the installation and activation period
- Quarter-hourly readout as a standard setting with a basic opt-out option for storage and transmission of quarter-hourly, monthly and daily readings
- Subject area: Decentralised supply:
- Self-supply: Generation, consumption, storage and sale of energy from renewable sources and participation in flexibility services (joint implementation of Art. 15 of Directive (EU) 2019/944 and Art. 21 of Directive (EU) 2018/2001)
- Load control through aggregation
- Extension of the scope of application of direct lines
- Subject area: Citizen energy/community supply:
- Peer-to-peer contracts: Contracts between self-suppliers and end customers for the sale of self-generated electricity from renewable sources
- Adding the option of storing energy to community generation plants
- Option of operating several local or regional renewable energy communities through a supporting company or association
- Full implementation of Directive (EU) 2019/944 on energy storage
- Subject area: Network operation:
- Systematic separation of grid connection and access
- Implementation of new tasks for distribution system operators
- Consolidation of the network operators' catalogues of obligations
- Subject area: System utilisation fees:
- Definition of principles and enhancement of the role of the regulatory authority in implementation of ECJ case law
- Consolidation of the grid access charge and the grid provision charge as a grid connection charge
- The previous system service fee will be absorbed into the operating reserve fee and the clearing fee will be replaced by the balancing group coordination fee
- Subject area: Security and reliability of supply:
- Market-based procurement of flexibility services in the distribution grid (implementation of Art. 32 par. 1 and 2 of Directive (EU) 2019/944)
- Procurement of non-frequency-bound system services (implementation of Art. 31 par. 7 and Art. 40 par. 5 and 6 of Directive (EU) 2019/944)
- Adaptation of the procurement of balancing reserve to Regulation (EU) 2017/2195
- Subject area: REMIT:
- Finetuning of provisions regarding prosecution, limitation periods and jurisdiction in matters relating to Regulation (EU) 1227/2011 on wholesale energy market integrity and transparency (REMIT)
b) Contents of the Energy Poverty Definition Act
- Establishing a definition of energy poverty for statistical recording
- Definition of indicators to be used for the statistical recording and measurement of energy poverty
- Provisions on competences and the procedure to identify eligibility for support
- Exchange and networking of relevant stakeholders to combat energy poverty
c) Contents of the amendments to the Energy Control Act
- Adaptation of the competences of executive bodies, references and terminology for congruence with the ElWG
- Clarification that the regulatory authority is also obliged to provide mutual assistance on administrative matters
- Detailing the procedural rules through an obligation
- to issue decisions subject to requirements, conditions or time limits if this is necessary for the fulfilment of legal requirements and
- to conduct public review procedures prior to the adoption of ordinances
3. Preliminary assessment
The draft contains many elements which have already been discussed on the subject of grid connection and grid utilisation for a (very) long time, and which could enable the faster expansion of renewable energy use (especially in the area of photovoltaics). However, laws per se do not actually create new grid capacities!
Although the promotion of decentralised energy supply and the introduction of consumers to their new role as prosumers contains one or two new "rights" (e.g. to the conclusion of aggregation contracts), (administrative) simplification in practical operations (e.g. for energy communities) or desired clarifications (e.g. for direct lines), the new legislation does not eliminate all practical hurdles in implementation by far and prima vista, someimportant clarifications are also missing. For example, peer-to-peer contracts are now explicitly "permitted" (electricity supply contracts between private parties were not previously prohibited!) but the definition of these contracts in sec. 6 par. 1 sub-par. 102 of the Electricity Industry Act (ElWG) is not very helpful at the end when it states the following: "The rights and obligations of the parties involved as end customers, producers, suppliers or aggregators remain unaffected by the right to peer-to-peer contracts." The previous “maximum credible accident” of regulatory confusion therefore remains in place. Well meant does not always mean well done!
The fact that the issues of basic supply and pricing/price changes, which have recently gained particular importance and topicality, are now to be discussed in a new "working group" is not very encouraging in an election year. A viable and legally secure solution for companies and consumers alike must now be found within a very short period of time - in the light of existing case law and pending legal disputes.
However, we will stay on the ball and continue to report. If you have any questions or other concerns about these matters or any other issues relating to energy, transformation, climate protection and sustainability, the KWR Energy Team will be happy to help you at all times.