Introduction to Battery Storage
Battery storage systems are now a central component of modern photovoltaic systems (PV systems) and play a crucial role in Germany’s energy transition. They enable the efficient storage and flexible use of solar power generated by PV systems – even when the sun isn’t shining. Thus, battery storage significantly contributes to increasing self-consumption, reducing electricity costs, and strengthening independence from external energy sources.
The operation of battery storage is based on temporarily storing excess energy from photovoltaic systems and feeding it back into the household grid when needed – for example, in the evening hours or on cloudy days. This optimizes the use of solar energy and facilitates the integration of renewable energies into the power grid. Especially in combination with PV systems, battery storage offers an attractive way to make one’s electricity supply more sustainable and economical.
Various types of battery storage are available on the market, differing in technology, storage capacity, charge and discharge cycles, as well as prices. The most widespread are lithium-ion batteries, known for their high efficiency, long lifespan, and compact design. Additionally, lead-acid batteries are used, which primarily stand out due to their comparatively low acquisition costs but have lower cycle durability. An innovative alternative is redox flow batteries, which are particularly suitable for larger photovoltaic systems and convince with their flexible scalability.
The decision of the Federal Court of Justice (BGH) that grid operators are permitted to charge construction cost surcharges under the performance price model for the grid connection of battery storage systems establishes clear legal framework conditions for operators and investors. The Federal Network Agency and grid operators play important roles in this context: they ensure the implementation of legal requirements, the collection of construction cost surcharges, and the integration of battery storage into the power grid.
Various funding programs are available to further promote the acquisition of battery storage and photovoltaic systems. In particular, the KfW funding program 275 supports the financing of battery storage and helps reduce investment costs and accelerate the spread of this technology.
In this article, we examine the most important aspects surrounding battery storage: from their operation and different types to the benefits for operators, as well as current funding programs and the legal framework conditions. The recent decision of the Federal Court of Justice (BGH) is also considered, along with the role of the Federal Network Agency and grid operators in the implementation of construction cost surcharges for battery storage and photovoltaic systems in Germany.
BGH Decision of 15.07.2025, Case No. EnVR 1/24
The Federal Court of Justice, based in Karlsruhe, decided with its ruling on July 15, 2025, that grid operators may charge construction cost surcharges according to the performance price model for battery storage systems (Case No. EnVR 1/24). The Cartel Senate of the BGH was responsible for the decision. The Federal Court of Justice’s task is to ensure legal unity and clarify fundamental legal questions in the field of energy law. The BGH also significantly contributes to the development of the law and issues rulings on complex legal issues. By this decision, the BGH has affirmed a previously contested question of energy law, thereby creating important legal certainty for grid operators, storage projects, and investors.
Thus, the BGH clarified that battery storage systems, like other grid connection customers, can be involved in expansion costs, according to the law firm MTR Legal Attorneys, which advises, among other areas, on energy law. The significance of the judiciary and the civil jurisdiction of the BGH in such matters underlines the practical relevance of this decision.
Fair Cost Allocation
Under German energy law, grid operators are entitled to charge connecting customers a so-called construction cost surcharge (BKZ). The determination and collection of the construction cost surcharge take place in a transparent procedure that considers the legal requirements for collection as well as the regulatory framework. The payment of the construction cost surcharge represents an important financial factor for connecting customers. Particularly at the low-voltage level, the collection of construction cost surcharges for battery storage systems plays a central role, as most storage systems are connected here. The determination of construction cost surcharges follows a clearly defined and non-discriminatory procedure. The BKZ serves to proportionally distribute the costs for the expansion or reinforcement of the power grid to those causing high capacity demands due to their connection. The goal is to ensure that not all network users bear the expansion costs for individual large consumers or installations.
However, it has been controversial so far, especially for large grid-connected battery storage systems, whether and how they should be classified under the construction cost surcharge regulations, because they behave differently in the grid compared to traditional consumers or producers. The role of the network connection point is crucial here, as this is where the assessment of the construction cost surcharge takes place. In the legal context of grid connection, battery storage systems are considered a distinct category, which impacts the application of the relevant regulations. The interests of network operators and connection users must be carefully balanced when determining the construction cost surcharges to ensure a fair and non-discriminatory solution. Battery storage systems draw electricity from the grid and feed it back later. Operators of such storage argued that they relieve the grid in the long term by clipping load peaks. It could therefore be concluded that they should not be treated like consumers or be charged twice. However, the Federal Network Agency had already endorsed applying the capacity charge model to storage systems. The role of the network connection point is also central to the assessment of construction cost surcharges, as it is where technical and regulatory requirements converge.
Federal Supreme Court (BGH): Network operators may demand construction cost surcharges
In the underlying case, the plaintiff operated a large, grid-connected battery storage system. The local network operator demanded a construction cost surcharge based on the storage’s maximum connection capacity. The network connection point, where the storage was connected to the distribution grid, was decisive for calculating the construction cost surcharge. The payment of the surcharge formed part of the total connection costs and was set through a transparent procedure. The operator refused, arguing that storage is neither a typical consumer nor producer but rather a special category of energy storage. Moreover, the operation of the storage through load management relieves the grid. Therefore, construction cost surcharges based on full connection capacity would be disproportionate and discriminatory. Neither the Federal Network Agency nor the previous courts accepted this argument. Ultimately, the case reached the Federal Supreme Court.
The BGH dismissed the storage operator’s appeal and confirmed the previous decisions. When determining the construction cost surcharge, the interests of all parties involved—network operators, operators, and investors—must be considered. The decision was made in compliance with the legal framework applicable to the connection of battery storage systems. The Federal Supreme Court plays a central role by clarifying fundamental legal questions in such cases and interpreting the applicable law. Accordingly, battery storage systems may be treated like end consumers when they draw electricity from the grid. Network operators are entitled to charge construction cost surcharges based on the capacity charge model. The judges in Karlsruhe found no violation of the non-discrimination rule under § 20 EnWG nor any impermissible double charging. They made clear that the existing regulatory regime includes battery storage systems in the general cost allocation.
No special treatment for battery storage systems
In its reasoning, the BGH made several key considerations. First, it emphasized the functional consumption: Even though a storage system does not ultimately consume electricity, it physically draws power from the grid. For the dimensioning and expansion of the grid, it is decisive which maximum capacity is drawn, not whether the electricity is fed back later. In the legal assessment, the network connection point is decisive for calculating the construction cost surcharge, as this is where the maximum connection capacity is determined. The classification of a battery storage system within the grid connection area directly affects the cost allocation between the network operator and the operator. The importance of the low-voltage level becomes particularly evident in the collection of construction cost surcharges, as specific technical and regulatory requirements apply here. Second, the court highlighted that network operators must design their grids for peak loads. If a storage system draws high power over a short period, this can cause additional grid expansion costs. Therefore, it is appropriate to use the connection capacity as the assessment parameter. The legal framework for calculating construction cost surcharges ensures that the interests of all parties involved are safeguarded.
Thirdly, the Federal Court of Justice (BGH) rejected the claim of impermissible discrimination. Storage operators are not treated worse than other large consumers or feed-in operators but are subject to the same rules. Special treatment in favor of storage systems would be incompatible with the principle of equal treatment under energy law, which is the legal basis of the BGH’s decision. When determining the construction cost surcharge, the interests of both the network operators and the operators of battery storage systems must be taken into account to achieve a balanced solution. The payment of the construction cost surcharge is part of the total costs for the grid connection and thus an important factor in the economic assessment of a project. Finally, the BGH also pointed to the incentive effect of the regulation. By levying construction cost surcharges, operators of large storage systems have an economic incentive to optimize their load profiles or to select locations where the grid is already adequately dimensioned. This promotes efficient grid usage and contributes to reducing overall costs in the long term.
Prudent Planning
According to the BGH ruling, network operators can continue to levy construction cost surcharges, thus providing a reliable basis for investments in grid expansion and grid security. For operators of battery storage systems, the decision means they must include the costs of construction cost surcharges in their profitability calculations. The choice of location is a decisive factor for the profitability and the amount of the construction cost surcharge, as different locations can lead to different costs. Customers benefit from early planning and optimization of storage projects because this lowers total costs and improves self-supply. Selecting a suitable location is an important part of project planning and affects the efficiency of the entire installation. The development of prices and the current price structure for battery storage play a central role in profitability calculations and investment decisions. The manufacturing process and technical characteristics of the battery are also important for selecting the appropriate storage system, as they influence lifespan and environmental balance. Charging the battery is an essential aspect for the efficiency of the overall system, especially in conjunction with a photovoltaic system or solar panel. An optimally integrated system consisting of photovoltaic panels, solar panels, and battery storage increases self-supply and reduces ongoing energy costs. The term battery storage refers to a system that stores electrical energy and releases it as needed to increase self-consumption. The choice of the type of battery storage, such as lithium-ion or lead-acid batteries, is an important factor for project planning and influences profitability. The interests of operators and investors play a significant role in location choice and financing, as they aim for optimal returns and supply security. The payment of the construction cost surcharge forms part of the total costs for the storage project and should be included in the calculation. When planning and implementing, all relevant aspects – from location selection to type of storage, prices, manufacturing, and legal framework – should be considered to realize a successful project in energy storage.
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