In late January 2025, the Bundestag passed a further regulation intended to increase grid connection capacity. Cable pooling will allow generation capacity to exceed the connection’s actual feed-in capacity. The legislative change addresses the current issue of renewable energy sources rarely utilising their full nominal feed-in capacity due to inherent volatility. The aim is to enable more flexible use of grid connection capacity.
Legislative change
On 31 January 2025, just prior to national elections, the outgoing Bundestag enacted a number of relevant changes to German energy law by passing the Act amending Energy Industry Law to avoid Temporary Production Surpluses (Gesetz zur Änderung des Energiewirtschaftsrechts zur Vermeidung von temporären Erzeugungsüberschüssen) (Federal Law Gazette 2025 I, no. 51) as well as the Act amending the Renewable Energy Sources Act to improve the Flexibility of Biogas Plants and secure Follow-up Funding (Gesetz zur Änderung des Erneuerbare-Energie-Gesetzes zur Flexibilisierung von Biogasanlagen und Sicherung der Anschlussförderung) (Federal Law Gazette 2025 I, no. 52). One of the changes was the amendment of section 8 Renewable Energy Sources Act (Erneuerbare-Energien-Gesetz, “EEG”) that came into effect on 25 February 2025. Subsection 2 now provides that an EEG installation may also be connected to the grid at a connection point already used by another EEG installation.
With this change, German legislators have established a statutory framework for cable pooling, enabling multiple electricity producers to share a single grid connection. This approach is expected to significantly reduce grid expansion costs and boost grid efficiency. The new section 8a EEG, will also allow the conclusion of flexible grid connection agreements, which will become necessary when grid and installation operators put cable pooling into practice. The act makes specific mention of battery storage systems, further promoting the co-location of such systems and EEG installations.
Background
Previously, electricity producers have always used grid connections that can handle the maximum output their installations produce so that all the electricity they generate when weather conditions are optimal can be fed into the electricity grid. But weather variability means that wind energy and solar installations usually generate significantly lower amounts of electricity than their maximum output, such that they frequently fail to fully exploit the grid connection’s capacity. A study by Fraunhofer Institute for Energy Economics and Energy System Technology (Fraunhofer-Institut für Energiewirtschaft und Energiesystemtechnik, IEE) and the Federal Association of Renewable Energy (Bundesverband Erneuerbare Energie, BEE) found that over 67% of grid capacity has been left unused by wind energy installations to date, and around 80% by solar installations.
Impact and options
Germany’s existing grid infrastructure is now to be used more efficiently with the help of cable pooling, enabling wind or solar park operators to share grid connections and the capacity-dependent connection costs. Amid increasing grid congestion, cable pooling thus adds connection capacity. In cable pooling, the total installed capacity of one or more connected installations exceeds the connection’s maximum capacity. Only rarely, experts state, does output have to be reduced because more electricity is being produced in total than the connection can feed into the grid at one time. Cable pooling at 250% of grid capacity leads to expected losses of around 6%, and 150% pooling to losses of just 1%.
The new section 8a EEG facilitates flexible grid connection agreements between grid and installation operators so that future output remains within the connection’s permissible capacity. A flexible grid connection agreement of this kind allows grid system operators to contractually limit feed-in from specific installations to the amount of electricity required. Such agreements can be static or dynamic and limited to a specific time frame. This is an advantage where parties wish to conclude a flexible grid connection agreement that ends when a grid expansion project has been completed. In this scenario, installations could begin (reduced) operation before the project is finished.
Numerous renewable energy producers still require grid connections for Germany to meet its energy transition goal of obtaining at least 80% of its electricity from renewables by 2030, as set out in section 1 EEG. The legislative change is intended to make this affordable and accelerate the connection of completed power-generating installations. In practice, wind and solar parks can be combined to compensate for the intermittency of each other’s output due to weather variability, thus stabilising the availability of renewable electricity.
Outlook
Grid connection capacity in Germany has increasingly constrained the development of renewables. These provisions on cable pooling tackle the volatility of renewables and increase grid efficiency. Where different operators are involved, there will be a need for contractual provisions to cover the commercial aspects of both the establishment of an additional connection as well as any curtailment required when the connection reaches capacity.
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