Federal Court of Justice confirms rates of return on equity set by the Federal Network Agency

On 22/03/2018, the Higher Regional Court (Oberlandesgericht – OLG) of Düsseldorf ruled that the rates of return on equity for the 3rd regulatory period had been set too low. Today, the Cartel Panel of the Federal Court of Justice (Bundesgerichtshof – BGH) did not follow the judgment of the Higher Regional Court. Therefore, there will be no improvement in investment conditions for the grid industry in Germany.

At the end of 2016, the Federal Network Agency (Bundesnetzagentur – BNetzA) had drastically lowered the rates of return on equity for the 3rd regulatory period. The electricity and gas grid operators were to make do with a rate of return reduced by one quarter to ensure grid operation in the face of the complex challenges posed by the energy transition.

In reaction, approximately 1,100 grid operators filed complaints with the Higher Regional Court of Düsseldorf against the determination of the Federal Network Agency. Of the 1,100 complainants, 600 have been advised by BBH with the BBH partners Stefan Missling (lawyer) and Rudolf Böck (public auditor, tax advisor) having the lead responsibility. Mr Laubenstein, the presiding judge at the Higher Regional Court endorsed the arguments of the complainants ruling that the rates of return on equity had been calculated incorrectly resulting in their levels being unreasonably low.

After the judgment delivered by the Federal Court of Justice today, it is clear that the Federal Court of Justice does not share the view of the Higher Regional Court as it ruled that the rates of return on equity for the 3rd regulatory period do not have to be adjusted upwards. “Unfortunately, the Federal Court of Justice has, in its decision, obviously disregarded the facts established with the help of experts and, in particular, the dramatic changes on the financial markets,” comments Stefan Missling stating that “it will now be necessary to wait for the reasons for the court’s decision in order to clarify which options remain for grid operators in these as well as in other cases.”

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 and tax matters and also assists them with business and strategic advice.


Prof. Dr. Ines Zenke
Lawyer, Partner
Tel +49 (0)30 611 28 40-179


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