BGH clarifies the limits of the definition of customer installations

On July 3, 2025, the BGH published the reasons for its ruling of May 13, 2025 (case no. EnVR 83/20) and provided the eagerly awaited clarifications on the interpretation of Section 3 No. 24a EnWG in accordance with EU law. In doing so, it took into account the ECJ’s referral decision(case no. C-293/23). The BGH emphasized that only a narrow scope of application remains for the customer installation pursuant to Section 3 No. 24a EnWG. It seems doubtful to us whether this is helpful in practice.

BGH only marginally clarifies the limits of interpretation in conformity with EU law and leaves affected companies in considerable legal uncertainty

With this decision, the BGH abandons its previous case law on Section 3 No. 24a EnWG and, as expected, agrees with the interpretation of the ECJ. In doing so, the BGH clarifies in line with the ECJ: Whenever a distribution network exists by definition, an exemption from regulation can only be made if the Internal Electricity Market Directive permits such an exemption. According to the ECJ, a distribution network is a network that is used for the transmission of electricity at high, medium or low voltage, which is intended for sale to wholesalers and end customers.

In line with the requirements of the ECJ, the BGH then goes on to state that the operators of a distribution network can only be exempted from regulation under the conditions specified in the Internal Electricity Market Directive. However, the exemptions triggered by Section 3 No. 24a EnWG can only be granted to energy installations that are not distribution networks. In this respect, customer installations only begin where the regulated grid cannot be accepted. Previously, it was necessary to assess whether the infrastructure to be assessed was a customer installation or a network. In future, it will only be possible to classify an infrastructure as an unregulated customer facility if and to the extent that the requirements for a network are not met. The hurdle for this assessment is much higher.

Remaining scope of application of Section 3 No. 24a EnWG

The BGH makes it clear that electricity distribution infrastructure must be defined as such on the basis of the definition of a distribution network developed by the ECJ. As a result, many supply infrastructures in comparable situations can no longer be classified as customer installations. However, according to the BGH, Section 3 No. 24a EnWG continues to offer a scope of application, for example for self-supply constellations or for “line systems connected to generation plants that are jointly operated and used by owners of a condominium complex or property owners”.
For this purpose, the BGH has chosen the term “self-supply”, which is unfortunately used in other contexts. In our opinion, this is not a case of own production and consumption by the same person, but rather a case of self-supply. The focus here is on the purpose of ensuring one’s own (energy) needs.

Many questions remain unanswered

The reasons for the decision do not provide any answers to questions that are very relevant in practice. For example, even after the publication of the reasons, it remains unclear at which point or from which technical equipment the regulated energy supply network ends, including in the case of apartment buildings. The BGH has not commented on this despite urgent requests from practitioners and the Federal Network Agency. Furthermore, the BGH did not specify how it interprets the characteristic of “sale”, which must be included in the purpose of the electricity transmission, for the existence of a distribution network. However, we believe that this is where the main discussions will take place.

Effects on Section 3 No. 24b EnWG open

It also remains open how exactly the assessments of the ECJ and the BGH are to be applied to the factual requirements of Section 3 No. 24b EnWG. This is because Section 3 No. 24b EnWG also exempts electricity distribution infrastructure from regulation. Nevertheless, in most cases the situation is such that the electricity is passed on to affiliated companies. The extent to which, for example, billing the electricity at cost price fulfills the characteristic of “sale” is unclear. Furthermore, it remains to be clarified whether the quota of up to 10 percent of electricity sales to third parties outside the group permitted under Section 3 No. 24b EnWG could counteract the classification as unregulated infrastructure in light of the ECJ’s statements.

Conclusion

Overall, the outcome of the BGH’s decision was as expected. The BGH has implemented the key guiding decisions established by the ECJ within the framework of the interpretation of Section 3 No. 24a EnWG in conformity with EU law. We had already feared that there were still various unanswered questions beyond the facts of the case to be decided. The national and European legislators are now called upon to create the necessary clarity as quickly as possible.