Against this backdrop, German TSOs introduced the new project maturity framework.
The project maturity framework
The project maturity framework has applied to large-scale storage projects connected to the transmission grid since 1 April 2026. It all became possible after battery storage systems were removed from Germany’s Power Plant Grid Connection Ordinance (KraftNAV) at the end of 2025.
Rather than allocating connection capacity based on the order in which applications are submitted, projects are now assessed in periodic application rounds. The key criteria include the likelihood of project delivery, the maturity of project development and the anticipated benefit to the electricity system. Where applications exceed available capacity, priority is given to the most advanced projects.
In principle, this approach is sensible. Scarce grid capacity should be allocated to projects that are most likely to be built, while speculative reservations should become less attractive. However, this also shifts much of the project development burden to an earlier stage. Developers must now provide extensive supporting evidence before receiving a grid connection offer, including secured land rights, permitting progress, technical concepts, creditworthiness and financing arrangements. In addition, applicants must pay a €50,000 (US$56,902.50) application fee and provide a security deposit of €1,500 per megawatt.
In practice, this means that capital and internal resources are committed at an early stage without certainty that a grid connection will ultimately be granted. Smaller developers and those relying on project finance, therefore, face substantially higher barriers to entry than well-capitalised market participants.
There is also a broader system question. The scarcity of grid connection capacity is, to a large extent, a consequence of grid expansion failing to keep pace with the growth of renewable generation.
Yet battery storage is not simply competing for scarce grid access; it can help address the underlying problem. By reducing congestion and increasing the utilisation of existing network infrastructure, storage can defer or even reduce the need for costly grid reinforcement. A project assessment framework that gives insufficient weight to this contribution risks overlooking one of storage’s most important system benefits.
Grandfathering protection
While the maturity framework focuses on how scarce grid access is allocated, a separate regulatory process is currently being negotiated through the AgNeS reform. Under Section 118(6) of Germany’s Energy Industry Act (EnWG), battery storage systems commissioned before 4 August 2029 are exempt from grid charges for a period of 20 years. This exemption forms a critical component of many investment cases and financing structures.
However, in early 2026, Germany’s Federal Network Agency (Bundesnetzagentur) raised questions about the future of this exemption through consultation documents published as part of the AgNeS grid tariff reform process. At one stage, even retrospective changes appeared possible. Following significant industry pushback, a compromise has emerged. Under the current proposal, grandfathering protection for projects commissioned before 4 August 2029 would largely remain in place, but only if they/these projects can demonstrate a final investment decision (FID) before the AgNeS framework takes effect, which Germany’s Federal Network Agency’s timeline places around the turn of 2026/27.
To qualify as an FID, developers would need to demonstrate substantial binding and effectively non-cancellable equipment orders, alongside a secured grid connection agreement. As a result, developers must commit half of the project capital before full regulatory certainty has been established.
It is worth being precise about what this changes. The Energy Industry Act itself attaches only one condition to the exemption – commissioning before 4 August 2029 – and says nothing about when a final investment decision must be taken. The FID deadline is therefore not a statutory requirement, but an additional hurdle introduced through the AgNeS process. The debate, however, remains ongoing. A first draft determination under the AgNeS process is expected this summer.
For many project-financed developments, this creates a circular financing dilemma: without regulatory certainty, financing becomes harder to secure; without financing, the required investment decision cannot be taken in time. Companies with strong balance sheets are far better positioned to absorb this challenge than developers that depend on external debt financing.
Different mechanisms, similar direction
The two measures are often discussed together, yet they address different parts of the market.
The maturity framework governs access to scarce grid capacity: its first round for transmission-connected projects closes at the end of June 2026, with results expected around December. These are large-scale projects whose connection dates are likely to fall well beyond 2029. As a result, they sit outside the grid-fee exemption window in any case, since that window closes for projects commissioned after 4 August 2029.
Grandfathering protection, by contrast, concerns an earlier cohort of projects – those already advanced enough to be commissioned before that date.
The two regimes therefore, therefore, affect different projects at different stages of development.
What the two developments do share, however, is a common direction of travel. Each, in its own way, rewards the ability to commit capital early and absorb development risk – whether to succeed in a competitive maturity assessment process or to reach a final investment decision on an increasingly compressed timetable. As a result, barriers to participation rise and market consolidation becomes more likely.
Yet the more specific concern lies on the grandfathering side. The projects most exposed to the investment-decision deadline are precisely the near-term, already-advanced developments that the exemption was written to support – not the later maturity-round cohort, which falls outside the window regardless. The new condition, therefore, does little to discipline the speculative pipeline it is associated with, while placing real pressure on exactly the projects the law set out to protect.
An industry without a safety net
This transition is particularly demanding because storage projects already operate largely on market-based revenues. Wind and solar projects benefited for many years from the predictable revenue structures provided under Germany’s Renewable Energy Sources Act (EEG) before being gradually exposed to greater market risk. Storage projects, by contrast, have faced market risk from the outset. They must now also contend with additional regulatory uncertainty and tighter financing timelines.
None of this means that the direction of reform is wrong. Germany needs significantly more flexibility across its power system, and battery storage will be central to delivering it. Grid connections should be allocated to projects that are actually ready to be built. Equally, the grid fee exemption was never intended to be a permanent instrument.
What matters most is the reliability of the regulatory framework. Capital is mobile, and it prices uncertainty immediately. Whenever established frameworks are reopened or statutory commitments are effectively narrowed through administrative requirements, investors demand higher risk premiums for future projects.
There is a straightforward way to honour that principle in the AgNeS process now under way. The Energy Industry Act conditions the 20-year grid-fee exemption on a single criterion: commissioning before 4 August 2029. Requiring, in addition, that a final investment decision be taken before the AgNeS framework takes effect introduces a hurdle the statute does not contain and narrows a legislated entitlement by administrative means – the very kind of after-the-fact tightening that legitimate-expectation protection is meant to prevent.
The cleaner and more credible course is to let the statutory test stand on its own: projects on track for commissioning before 4 August 2029 should keep the exemption the law already grants them, without a separate investment-decision deadline layered on top.
The sector has grown rapidly in recent years. Yet without stable, standardised and investable framework conditions, there is a risk that the deployment of one of the energy transition’s most important enabling technologies will be slowed at precisely the moment when Germany needs more flexibility across its power system.
About the Author
Thomas Antonioli is co-founder and chief financial officer (CFO) of Terra One, a developer and operator of battery energy storage systems (BESS). He is responsible for the company’s finance, investment strategy and commercial development activities. Prior to joining Terra One, he held senior roles in banking and high-growth technology businesses across Europe.
