E. LEGAL FOUNDATIONS IN GERMAN AND EUROPEAN UNION LAW
I. E NERGY L AW
The field of energy law cannot be located in one single national German code, but is rather spread over a number of laws and statutory orders. It combines elements of both, private and public law, since most of the rules refer to (private) contracts, that are, how-ever, partly subject to regulatory interventions by the Federal Network Agency (FNA).269 In a narrow sense, energy law “can be understood as the sum of all legal norms with validity exclusively for the power and gas industry”.270
The basic rules for the energy sector are codified in the German Law on the Energy Indus-try (Energiewirtschaftsgesetz, EnWG)271, which is mainly treating questions of network access (Sec. 20(1), (1a) EnWG), access fees (Sec. 21 EnWG), and basic supply for cus-tomers (Sec. 36 EnWG). Sec. 1 EnWG defines the central objectives of German energy law: First and most importantly, supply of the general public with electricity shall be reli-able, reasonably priced, consumer-friendly, efficient, and ecological.272 Second, effective and undistorted competition in energy supply, as well as guaranteed long-term powerful
269 Ulrich Büdenbender, Wolff Heintschel von Heinegg and Peter Rosin, Energierecht I. Recht der Energieanla-gen (Berlin: de Gruyter, 1999), 7.
270 Ibid, 6. Translation by the author.
271 Heino Mengers, Energierecht. Handbuch, 2nd ed., ed. Christoph Germer and Helmut Loibl (Berlin: Erich Schmidt Verlag, 2007), 22.
272 Ibid, 32.
and reliable operation of power grids shall be ensured.273 Third, the European requirements in the field of energy law shall be enforced.274
In order to meet these standards, the act contains comprehensive regulatory require-ments, further concretized in statutory orders based on Sec. 21, 21a, 24 EnWG with regard to network access (German Statutory Order on Network Access for Electricity, Stromnetz-zugangsverordnung – StromNZV) and access fees (German Statutory Order on Access Fees for Electricity, Stromnetzentgeltverordnung - StromNEV).
Besides the EnWG, the German Renewable Energy Act (Gesetz für den Vorrang Erneu-erbarer Energie, EEG) contains provisions on connection requirements for renewables, preferential feed-in of this current, and the guaranteed feed-in tariffs.275 Notably, the re-newable energy act establishes a claim for a 20-year fixed remuneration of energy stem-ming from renewable sources (Sec. 16ff. EEG) and obligates network operators to buy this electricity with priority (Sec. 8 EEG).276 In 2010, the renewed Statutory Order on the EEG Clearing Mechanism (Ausgleichsmechanismusverordnung, AusglMechV) came into effect, forcing transmission system operators to sell current from EEG installations in the spot market (Sec. 2(2) AusglMechV).277 These rules exert huge influence on the price formation at the energy exchange through the so-called merit-order effect278, which will be discussed later in this work.279
Eventually, the rules on emissions trading relevant to industrial power plants (German Act on Emissions Trading, Treibhausgasemissionshandelsgesetz – TEHG – and related laws), and numerous regulations, particularly from the Federal Network Agency (FNA), shape the legal framework energy producers, distributors, and traders operate in.280
273 Ibid, 120-121.
274 The liberalization of the German energy market was driven by the European directive N° 96/92 on the sin-gle European power market from December 12, 1996, EU Official Journal from January 30, 1997 L 27, 20, that was forcing member states to open their power industry for competition.
275 Jens-Peter Schneider, Recht der Energiewirtschaft. Praxishandbuch, 3rd ed., ed. Jens-Peter Schneider and Christian Theobald (München: C.H. Beck, 2011), 1204-1205.
276 Federal Cartel Office, Sektoruntersuchung Stromerzeugung/Stromgroßhandel, No. B10-9/09, 65. Also Peter Salje, Erneuerbare-Energien-Gesetz. Kommentar, 5th ed. (Köln: Carl Heymanns Verlag, 2009), 343ff., 493ff.
277 Jens-Peter Schneider, Recht der Energiewirtschaft. Praxishandbuch, 3rd ed., ed. Jens-Peter Schneider and Christian Theobald (München: C.H. Beck, 2011), 1233ff.
278 This term describes the decrease of the power price at the EEX in the event of an installation with lower variable cost entering the market. Particularly wind power and photovoltaic (PV) are typical examples of instal-lations that regularly squeeze more expensive plants out of the merit order. For an analysis of the volume of this effect, see the simulation by Frank Sensfuß, Mario Ragwitz, and Massimo Genoese, “The merit-order ef-fect: A detailed analysis of the price effect of renewable electricity generation on spot market prices in Ger-many”, Energy Policy, Vol. 36, no. 8 (2008), 3086-3094.
279 Refer to the third chapter, section D.I.1. of this work.
280 For a comprehensive overview of the rules and regulations for the power sector that would go far beyond the scope of this work, please refer to e.g. Jens-Peter Schneider and Christian Theobald (ed.), Recht der Ener-giewirtschaft. Praxishandbuch, 3rd ed. (München: C.H. Beck, 2011).
In August 2011, as a consequence of the nuclear catastrophe in Fukushima, the German energy law experienced an abrupt turnaround. Within a few weeks, the German parliament decided to quit energy production from nuclear sources until 2022 and switch to renewable sources of energy.281 The existing laws, most importantly the Atomic Energy Act (Atomge-setz – AtG)282, the EnWG283, and the EEG284 were amended to permit the change in para-digm in German energy policy.285 Main changes in the EnWG refer to the unbundling on the electricity and gas markets, accelerated network expansion, and simplified rules for the change of suppliers for end customers.286 With regard to the promotion of renewable energy sources – the Federal Government plans to increase the share of renewables in the energy production to 35 percent until 2020 and 80 percent until the year 2050287 – the EEG was amended in order to avoid severe price increases. In particular, a market pre-mium is supposed to incentivize producers to sell their electricity individually at the ex-changes as an alternative to the legally guaranteed payment (Sec. 33a to 33i EEG).288 Further amendments aim at the relief of the energy intensive industry from the EEG cost.289
The amendments resulting from the energy turnaround290 will affect the above-described supply side of the market in the future, notably the appearance of the merit order. Since this regulatory change happened after the exemplary period of examination treated in this work, it did not influence the market equilibrium during the years 2006 to 2009 and is therefore without relevance for the more general research question on regulatory impacts on manipulation incentives.
281 Birgit Ortlieb, “Das Gesetzespaket zur Energiewende – Zusammenfassender Überblick über die wesentli-chen Inhalte der acht am 8. Juli 2011 endgültig verabschiedeten, mittlerweile im Bundesgesetzblatt veröffent-lichten (und zum größten Teil auch bereits in Kraft getretenen) Gesetze”, EWeRK, Vol. 11, no. 4 (2011), 151.
282 Amendment of the AtG: BGBl. I 2011, p. 1704-1705, effective from August 5th, 2011.
283 Amendment of the EnWG: BGBl. I 2011, p. 1634-1678, effective from August 47h, 2011; partly also serv-ing as transformation of the Third Sserv-ingle Energy Market Package of the European Union.
284 Amendment of the EEG: BGBl. I 2011, p. 1634-1678, effective from January 1st, 2012.
285 For an overview of the main changes, see Birgit Ortlieb, “Das Gesetzespaket zur Energiewende – Zusam-menfassender Überblick über die wesentlichen Inhalte der acht am 8. Juli 2011 endgültig verabschiedeten, mittlerweile im Bundesgesetzblatt veröffentlichten (und zum größten Teil auch bereits in Kraft getretenen) Ge-setze”, EWeRK, Vol. 11, no. 4 (2011), 151.
286 Ibid, 153-154.
287 German Federal Government, “Energiekonzept für eine umweltschonende, zuverlässige und bezahlbare Energieversorgung.”, 2010.
288 Florian Valentin, “Das neue System der Direktvermarktung von EEG-Strom im Überblick”, ree, Vol. 2, no. 1 (2012), 11.
289 Christian Buchmüller and Jörn Schnutenhaus, “Die Entlastung stromintensiver Unternehmen durch das Energiepaket des Bundestages“, EWeRK Vol. 11, no. 4 (2011), 132-134.
290 The word describes the historic German project to change its energy supply to green, nonnuclear and re-newable sources. In the meantime, it is also known in English-speaking countries in its original German term
“The Energiewende”. See Paul Hockenos, “The Energiewende”, Die Zeit Vol. 67, no. 47 from November 15, 2012. Available online at http://www.zeit.de/2012/47/Energiewende-Deutsche-Begriffe-Englisch.