Elenia appeals to the Market Court to repeal the Energy Authority’s regulatory confirmation decision

The regulatory methods confirmed by the Energy Authority (EA) that came into force at the beginning of 2024 fundamentally undermine the operating conditions and investment capacity of electricity distribution system operators (DSOs) and are in contradiction with the requirements of the Electricity Market Act.

The regulatory methods for 6th and 7th regulatory periods (2024-2027 and 2028-2031) entered into force at the beginning of the year. Elenia Verkko Oyj has submitted an appeal to the Market Court to repeal the EA's confirmation decision. The industry stands unified as 66 other DSOs, that cover approximately 98% of the customers in Finland, have filed their own appeal coordinated by the Finnish Energy.

The EA’s decision represents a substantial deviation from the methods and principles of distribution network regulation that has been well functioning and established in Finland. Especially, the amended method of defining the DSOs' electricity network assets is in contradiction with the applicable electricity market legislation, both in terms of content and impacts. The new methods will significantly weaken the DSOs’ operating conditions and investment capabilities. Elenia considers the changes to the regulatory methods to be partly illegal and excessive.

It is important for the DSOs that the principles of regulation are clear and consistent. At the same time, the regulatory methods should ensure that customers' network service charges remain reasonable, and that the DSOs can continue to invest in electricity networks and develop network services to achieve a high level of security of supply as required by the law. The regulatory methods for the next eight years do not meet the latter requirement and the new methods are therefore not in line with the Electricity Market Act.

The endangerment of long-term network investments is also in contradiction with Finnish clean transition and carbon neutrality objectives. The EA has ignored the European Commission's view that electricity networks play a key role in achieving the clean transition targets and omitted any meaningful impact assessment of the amendments to the regulatory methods.