A fresh start for redispatch? ‘BilAReM’ and the draft guidelines on reasonable reimbursement of expenses

The switch to Redispatch 2.0 was intended to digitise German congestion management, but it presented market participants – particularly those in the distribution network – with immense challenges. With the provisions on the balancing of Redispatch measures and the draft guidelines for determining reasonable reimbursement of expenses, the regulatory framework is now taking on new forms. We explain the current situation.

October 2026

When it comes to redispatch, the sector has been at a standstill for around five years. Whilst the physical expansion of the grid is lagging behind, the decentralised roll-out of renewable energy is growing massively – which is putting increasing pressure on the system every day. The costs of congestion management amounted to approximately three billion euros in 2025, yet renewable energy plant operators received only around 433 million euros in financial compensation.[1]

The statutory accounting adjustment at distribution network level proved, in practice, to be too complex for a mass-scale process. For a long time, the industry made do with the BDEW’s interim solution.[2] The Federal Network Agency’s guidelines are now restructuring the processes and financial expenditure rates.

Forecast model vs. planned value model

The key difference between the planned value model and the forecast model lies in who reports the expected generation and how the lost electricity volume (outage energy) is determined in the event of a grid intervention:

 

Planned value model (ex-ante)

  • The direct marketer or operations manager (EIV) submits the planned operating profile of the controllable resource to the grid operator in advance as quarter-hourly planning data. These values serve as the reference for how the plant would likely have been operated had no redispatch measures been taken.
  • If the grid operator orders a change in output, the affected balancing group is specifically adjusted as if the plant had fed electricity into the grid or drawn electricity in accordance with its previously reported plan. The lost work relevant for balancing and settlement is determined on the basis of this planning data and the actual operating profile.
  • The model thus enables transparent balancing on a plant-by-plant basis; however, it requires reliable forecasts, timely data reporting and largely automated market processes.

Source: Federal Network Agency, BK6-23-241, ‘Procedure for the Further Development of Redispatch 2.0’, Decision of 7 May 2026, in particular Annex 2 ‘Balancing of Redispatch Measures (BilAReM)’.

 

Forecasting model (ex-post)

  • In the forecasting model, no plant-specific planning data provided by the operations manager is used as a binding basis for targeted balancing by the system operator. Instead, the system operator forecasts the expected feed-in or withdrawal from the controllable resource.
  • In the event of a redispatch measure, balance settlement is carried out in a non-targeted manner by the balancing group manager responsible for the affected feed-in or withdrawal point. The out-of-service work is determined retrospectively on the basis of the forecast or hypothetical operating profile without redispatch and the actual operating profile; in particular, measurement, weather and reference data, as well as established calculation methods, may be used for this purpose.

Source: Federal Network Agency, Specification BK6-23-241 on the further development of the balancing of redispatch measures, Decision of 7 May 2026, in particular Annex 2 ‘Balancing of Redispatch Measures (BilAReM)’.

BilAReM: The regulatory framework and the 2031 target pathway

On 7 May 2026, the Federal Network Agency (BNetzA) therefore issued Decision BK6-23-241[3] “Provisions on the accounting settlement of redispatch measures” (BilAReM) have been adopted. These provisions replace the previous Redispatch 2.0 provisions BK6-20-059, BK6-20-060 and BK6-20-061.

The primary aim of BilAReM is to establish uniform rules for accounting, outage compensation, data provision and market communication. Above all, it is intended to set out the long-term roadmap towards the target value model (see box).

From a regulatory perspective, the BNetzA is pursuing a two-stage transformation:

  1. For existing installations in the distribution network, the forecasting model will continue on a temporary basis until 31 December 2031.
  2. By 1 January 2031 at the latest, all installations relevant to redispatch are to be gradually transitioned to the target value model in order to enable ex-ante transparency and automated mass processes.
     

 

Outage-related work: Changes to billing

  • The flat-rate billing system is being phased out and is to be gradually abolished by the end of 2028.
  • In future, simplified peak billing will become the norm, unless plant operators opt for a different method. At the same time, grid operators are to establish practical communication processes for the mass market.
  • For offshore wind farms, the ‘Wind-Bin’ method will be available as an option. SCADA data will take actual plant performance into account and make billing more accurate.

In addition, the BilAReM significantly tightens the requirements for market participants: large-scale battery energy storage systems (BESS) will in future be subject to considerably expanded reporting and data provision obligations. Furthermore, planning data for redispatch and balancing power must in future explicitly include details on reserve capacity and backup capacity. At the same time, distribution system operators (DSOs) are obliged to engage in more intensive horizontal and vertical coordination in order to coordinate flexibility and redispatch potential across the grid.

 

A statutory paradigm shift regarding balancing for redispatch and the determination of financial compensation for expenses

One of the most significant changes affecting direct marketing contracts stems from the amendment to Section 14(1b) of the Energy Act (EnWG) of 23 December 2025: Where a distribution system operator is not obliged to provide balancing, this is replaced by financial compensation for expenses.

By law, the plant operator is entitled to this compensation for expenses, and no longer the direct marketer in their capacity as the balancing group manager (BKV). Although the BKV continues to carry out the balancing of accounts in practice, the financial compensation for the resulting balancing group deviations is settled between the distribution system operator (VNB) and the plant operator. With regard to the amount and calculation of the appropriate reimbursement of expenses, Decision Chamber 8 accepts, pending the entry into force of a definitive ruling, costs calculated using the mixed-price method in accordance with the BDEW transitional solution.[4]

 

Reasonable reimbursement of expenses and composite price – clarification in a new determination procedure BK8-26-001-A

In order to simplify the calculation of this reimbursement of expenses using flat-rate determination methods, Decision Chamber 8 initially issued a key points paper on 8 June 2026 regarding the adoption of a determination on cost reimbursement in ‘off-balance-sheet’ redispatch[5] published, which, during the consultation process, was deemed by the industry to be too complex to implement.

Consequently, on 1 October 2026, Decision-Making Chamber 8 of the Federal Network Agency (BNetzA) published a draft determination on the appropriate reimbursement of expenses for the implementation of balancing measures (reimbursement of costs for redispatch measures without targeted balancing by the system operator, BK8-26-001-A) [6]. Consultations are open until 21 October; the regulations are scheduled to come into force on 1 January 2027.

In it, the BNetzA proposes a flat-rate calculation method:

  1. The reimbursement of expenses is calculated using a combination of the intraday price index ID-AEP (auction closing price, which replaces the previous ID1 index) and the uniform cross-control-area balancing energy price (reBAP). This is also referred to as a mixed price.
  2. A fixed overhead cost allowance of 1.35 euros/MWh forms part of the financial reimbursement. This compensates the BKV for administrative and operational costs, as well as for any additional costs incurred in carrying out balance settlement.
  3. Network operators who signal more than 20 per cent of their annual negative redispatch volumes later than 30 minutes before the start of the measure must bear a financial excess when costs are passed on. This is intended to compel distribution system operators to exchange data in a timely manner.

 

Impact on direct marketing contracts from 2027

From 2027, there will be two predominant remuneration models in the market regarding the contractual structure of direct marketing contracts in relation to any redispatch compensation payments:

 

Option 1: No compensation from the direct marketer for lost redispatch work

Compensation payment by the transmission system operator in accordance with Section 14(1b) of the Energy Act (EnWG) directly to the plant operator, with reasonable reimbursement of expenses (currently a mixed price)

Option 2: With remuneration for redispatch out-of-service work based on the monthly market value/spot price

Compensation payment by the direct marketer as the difference between the monthly market value and the calculated uniform mixed price per quarter of an hour (72.5 per cent Intraday Balancing Energy Index (IDAEP) and 27.5 per cent cross-control-area uniform balancing energy price (ReBAP)), less a flat-rate overhead charge of €1.35/MWh. Condition: Entry into force of specification BK8-26-001-A on 1 January 2027.
 

Conclusion

The BilAReM specification and the draft specification for determining appropriate reimbursement of expenses, dated October 2026, mark a turning point for Redispatch 2.0. The path forward is clear: towards the target value model for redispatch-relevant installations by 2031 (BilAReM) and the introduction of a specific, billable flat-rate for cost reimbursement from 2027 onwards. In addition, network operators and the industry face the task of further developing and implementing business processes suitable for large-scale implementation.

 

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[1] https://www.smard.de/page/home/topic-article/444/219906/massnahmenvolumen-im-gesamtjahr-stabil

[2] https://www.bdew.de/energie/bdew-uebergangsloesung-zum-gesicherten-einstieg-in-den-redispatch-20-zum-1-oktober-2021/

[3] https://www.bundesnetzagentur.de/DE/Beschlusskammern/1_GZ/BK6-GZ/2023/BK6-23-241/BK6-23-241_beschluss.html

[4] https://www.bundesnetzagentur.de/DE/Beschlusskammern/BK06/BK6_84_Sys_Dienst/844_redispatch/Mitteilung_12/mitteilung_nr_12.html?nn=877592)

[5] https://www.bundesnetzagentur.de/DE/Beschlusskammern/1_GZ/BK8-GZ/2026/2026_3-Steller/BK8-26-001/Downloads/BK8-26-001-A_Eckpunktepapier_DL_BF.pdf?__blob=publicationFile&v=5

[6] https://www.bundesnetzagentur.de/DE/Beschlusskammern/1_GZ/BK8-GZ/2026/2026_3-Steller/BK8-26-001/Downloads/BK8-26-001-A_Festlegungsentwurf_DL_BF.pdf?__blob=publicationFile&v=4