Energy transition: The departure from fossil fuels brings with it numerous conflicts – especially so when it must be achieved without Russian gas

In public debate, Germany’s energy transition (Energiewende) is usually understood as a technical and political challenge. In reality, it is at the same time a profound legal phenomenon. The gradual move away from established energy sources has for years been generating a multi-layered landscape of legal disputes – a landscape that was abruptly expanded by the sudden departure from Russian gas.

In detail:

1. Disputes over grid connection

Grid connection is a frequent subject of dispute between operators of renewable energy installations and grid operators. The Renewable Energy Sources Act (Erneuerbare Energien Gesetz, EEG) grants installation operators a statutory right to grid connection as against grid operators. The underlying principle is: „The grid follows the installation – not the other way around.“ Since the grid must „follow“ the installation, bottlenecks regularly arise.

Disputes arise in particular over the choice and reasonableness of the grid connection point, the scope of the statutory connection obligation, and the transparency and non-discriminatory application of criteria in reservation and allocation procedures. Further disputes concern the consequences of delayed or refused grid connections, questions of liability for impairments to grid security, and liability issues in connection with late or incorrect grid connection notifications and compliance with deadlines relevant to remuneration law. The conclusion is obvious: the more new installations are to be connected to the grid, the greater the potential for conflict in this area.

2. Disputes over EEG remuneration

The energy transition also gives rise to numerous disputes concerning the EEG remuneration system, which is designed to underpin renewable energy investments financially through state-guaranteed remuneration. Conflicts arise at several levels: between installation operators and grid operators over the amount and entitlement of remuneration claims, between installation operators and the state over the correct implementation of the eligibility conditions for support, and between regulatory authorities and grid operators, for example in connection with delayed disbursements of EEG subsidy funds. The same principle applies here: the more installations fall under this regime, the greater the potential for dispute.

3. Disputes over defects and delays

New technologies within the framework of the energy transition continually create new sources of conflict. Projects are frequently planned optimistically due to a lack of empirical benchmarks – and regularly exceed their originally scheduled timelines during implementation. Fault may lie with the contracting parties, but also with authorities that cannot readily approve novel technologies. Legal responsibility for delays is then regularly contested.

In addition to delay disputes, new technologies frequently give rise to disputes over defects: since new technologies have not yet been tested in practice, the actual condition of an installation often deviates significantly from the planned target condition. Finally, authorities too must first become accustomed to new technologies, which leads to conflicts over subsidies, levies and public law requirements.

4. Further fields of disputes

In addition to the core conflicts mentioned above, further areas of dispute are growing in the course of the energy transition – for example in competition law through the emergence of new companies with significant or dominant market positions, in patent law through new technologies, and in construction and planning law. This list is not exhaustive.

What must be noted is this: the expansion of renewable energy does not generate isolated, random individual conflicts, but rather forms a structural conflict topography spanning payment flows, grid connections, subsidies and permits.

5. Disputes arising from the departure from Russian gas

The landscape described above was further intensified by the abrupt departure from Russian gas supplies from 2022 onwards.

On one hand, the existing sources of conflict are being further aggravated by the increased demand for energy, as the market is now shifting even more strongly from fossil fuels to renewable energy. This shift is also significantly attributable to the war in Ukraine: the loss of Russian gas supplies triggered by the war and the dramatic rise in energy prices forced Europe into an accelerated departure from fossil fuels. The newly installed capacity of photovoltaic systems rose by 73.2% in 2022 compared to the previous year; in the first half of 2023, this trend continued with a further increase of 56.7%. Wind and solar power production in the EU also rose by 13% from March to September 2022 compared to the previous year – a record value achieved by 19 EU member states during this period – thereby underscoring the fact that the war in Ukraine acted as a significant catalyst for the European energy transition.

On the other hand, entirely new areas of dispute are emerging alongside the intensification of the existing conflict landscape. Long-term gas supply contracts were for decades regarded as the cornerstone of European energy supply security – terms of up to 30 years were not uncommon. When deliveries abruptly ceased in 2022, purchasers brought claims for damages for non-performance in breach of contract and for the procurement of replacement supplies at inflated prices; transporters demanded payment for the unused provision of transport capacities.

A novel phenomenon also emerged: institutional enforcement obstruction. What was previously a rare exception – the resistance to arbitral awards by unsuccessful parties – became the blanket strategy of the Russian state: arbitral tribunals are not recognised, challenged by means of anti-suit injunctions, parallel proceedings are conducted without the involvement of Russian companies, and arbitral awards are not enforced. The actual theatre of conflict has thus shifted to the enforcement proceedings.

6. Conclusion

All of this demonstrates that the energy transition is not merely a technical and political transformation, but also a legal one. The areas of conflict described make clear that companies and state actors are operating in a legal environment that is undergoing rapid change – an environment in which established legal principles encounter new sets of facts for which reliable standards are in many cases still absent. This tension has been further exacerbated in Germany by the accelerated exit from Russian gas supplies.