BRUSSELS À JOUR: Foreign Subsidies Regulation - a Year of Mandatory Notifications in Review
4 November 2024
On 25 September 2024, the General Court of the European Union (EGC) annulled a decision of the Board of Appeal of the European Agency for the Cooperation of Energy Regulators (ACER) in the case T-482/21. The decision concerns the cost allocation methodology for cross-border congestion management measures in electricity transmission grids (so-called redispatching and countertrading) in the CORE region, which comprises Belgium, the Czech Republic, Germany, France, Croatia, Luxembourg, Hungary, the Netherlands, Austria, Poland, Romania, Slovenia, Slovakia, Northern Ireland, and Ireland. The methodology issued by ACER in November 2020 has significant financial implications for the affected electricity transmission system operators and European end consumers. The Board of Appeal initially confirmed ACER's decision in May 2021 after several electricity transmission system operators, including TenneT, and several national regulatory authorities lodged an appeal.
The EGC now stated that the contested decision of the Board of Appeal of ACER violates EU law. In particular, the EGC found that the level of tolerance determined by ACER for permissible so-called loop flows, i.e. electricity flows, which result from grid congestion and burden the electricity grid in neighbouring Member States, was not in line with requirements of the Electricity Market Regulation (Regulation (EU) 2019/943). Furthermore, the EGC held that the Board of Appeal incorrectly confirmed the methodology established by ACER for determining the causer of such loop flows. Further details on the decision can be found in the EGC's communication.
The judgement of the EGC annuls the contested decision. An appeal against the judgement can be lodged with the European Court of Justice (ECJ) if the ECJ admits the appeal to proceed.
Hengeler Mueller represented the German and Dutch transmission system operators, TenneT TSO B.V. and TenneT TSO GmbH (TenneT), in the proceedings before the Board of Appeal of ACER and the EGC.
Hengeler Mueller team for TenneT
Energy Regulatory/Dispute Resolution: Jörg Meinzenbach (lead), Dirk Uwer (both partners), Paul David Rieger, Rebecca Klein (both senior associates, all Düsseldorf).
