Construction cost subsidy

The term construction cost subsidy (BKZ) refers to one-off payments for the expansion (creation and/or reinforcement) of the upstream grid when a grid connection is created or reinforced. They are charged by the grid operator. The BKZ must be paid by the subscriber. The BKZ is not consumption-dependent, but performance-dependent. Building cost subsidies are only charged for load-side consumption, i.e. for consumption from the grid. The type of load connected is irrelevant when charging the BKZ. The focus is on the power consumption itself. This also applies to operators of electricity supply networks among themselves.

Transmission system operators can differentiate the amount when determining the BKZ. An impact-related differentiation must be presented transparently on the basis of specific calculations and the underlying assumptions. A differentiation can be made, for example, if the establishment of a consumer - e.g. a factory, an electrolyzer or an electricity storage facility - results in lower or no additional costs from the perspective of the grid at a specific location. At the same time, a lower construction cost subsidy could incentivize large consumers to select a location with sufficient or even excess electricity supply.

Further information from the Federal Network Agency and the BNetzA position paper published in November 2024 on the levying of construction cost subsidies can be found here:

https://www.bundesnetzagentur.de/DE/Beschlusskammern/BK08/BK8_06_Netzentgelte/70_BKZ/BK8_BKZ.html

The following is information from the transmission system operators 50Hertz, Amprion, TenneT and TransnetBW on the calculation of the construction cost subsidy:

Calculation of the construction cost subsidy

Based on the updated Positionspapiers der Bundesnetzagentur dated 20.11.2024¹ the four German transmission system operators with control area responsibility are required to present an impact-related differentiation of the construction cost surcharge on the basis of a specific calculation and to publish the resulting construction cost surcharge and the regionalization factors. According to the position paper, the construction cost surcharge is levied irrespective of the type of load connected and also applies to operators of electricity supply networks.

Price sheets:

The Construction cost subsidy for the following year is calculated according to the following formula:

The demand charge relates to the requested grid level and reflects the average of the past five years, taking into account services with more than 2,500 operating hours per year. In the case of different TSO charges, the arithmetic mean of the capacity charges is calculated first, which is then used to calculate the average of the four previous years and the current year.³

Please refer to the published price sheets of the TSOs for the average demand charges to be used for the calculation of any construction cost subsidies.

¹https://www.bundesnetzagentur.de/DE/Beschlusskammern/BK08/BK8_06_Netzentgelte/70_BKZ/BK8_BKZ.html

²Formula based on BNetzA position paper

³Due to the standardization of the transmission system operators' fees, a uniform capacity price will only be applied from 2023. For the period in the past when these were not yet standardized, an arithmetic mean of the capacity prices of the four TSOs in a calendar year can be calculated and included. The price sheets of the four TSOs are published on the respective TSO websites.

Overview of regionalization factors (Stand: 12/2024)

A list of substations and the corresponding regionalization factors can be found under the following link:

Umspannanlagen mit Regionalisierungsfaktoren

Procedure of the TSOs:

Scenario analysis: Based on an existing analysis (time horizon t+3 to t+5), the transmission system operators calculate the effects of the connection or grid usage by an additional load.
Evaluation criterias: The transmission system operators assess the change in the congestion management volume due to the additional load on the basis of representative grid usage cases.
Grid-friendly gradation: The grid-related construction cost subsidy is based on the change in the congestion management volume and is divided into five levels. The gradation is based on the change in the congestion management volume of the respective grid nodes.

Repetition interval:

The calculation and the underlying data are reviewed and updated at least every two years to take account of interim changes.

General remark:

Irrespective of the construction cost subsidy, the own grid connection costs from the system to the next suitable grid connection point (grid connection cost contributions) must continue to be borne by the connection recipient. This also applies to distribution grid operators.

Further information on the grid connection process can be found on the individual websites of the transmission system operators: