FRANKFURT, ‌Dec 10 (Reuters) - Germany's energy regulator has proposed new rules ‍that would ‌let power grid operators earn at least 1.4% more ⁠from 2029, when the next ‌five-year regulatory period begins.

In exchange, about 900 qualifying companies will face tougher efficiency targets under stronger incentives, the Bundesnetzagentur said ahead ⁠of a media call.

"Investments in the German electricity grids are becoming more attractive. ​At the same time, we are ensuring ‌that grid operators manage their ⁠operations more efficiently," said Bundesnetzagentur president Klaus Mueller, referring to a draft that also includes provisions for gas ​grid firms from 2028.

The regulator oversees earnings for electricity and gas networks, which are natural monopolies.

The statement set out steps to reform a system of spending returns for ​new five-year ‍frameworks for power ​and gas, respectively.

The new framework continues to cap allowed returns over multi-year periods but will track global interest rates more closely, it said..

The 1.4% figure reflects changes under the agency’s NEST process, it said, adding that companies could earn more ⁠from rising investment volumes and higher interest rates independently of that process.

Germany's power grids ​need major upgrades to handle surging demand from AI-driven data centres and the electrification of heating and transport.

Gas operators, meanwhile, face shrinking customer bases as fossil ‌fuel use declines, even as they invest in hydrogen-ready infrastructure.

(Reporting by Vera Eckert; Editing by Miranda Murray and Louise Heavens)