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APPLICATION OF THE ERES SUPPORT MECHANISM IN ROMANIA Primary and Secondary Legislation 1.

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Presentation on theme: "APPLICATION OF THE ERES SUPPORT MECHANISM IN ROMANIA Primary and Secondary Legislation 1."— Presentation transcript:

1 APPLICATION OF THE ERES SUPPORT MECHANISM IN ROMANIA Primary and Secondary Legislation 1

2 Executive Summary The legislative framework for promoting ERES in Romania is currently complete and enforced starting November 1 st In the first week of December the producers will receive the 2 GC/MWh corresponding to the electricity delivered into the grid during November. The primary legislation was modified as a consequence of the European Commission’s (DG Competition) approval. There are 10 main amendments concerning wind energy. The secondary legislation elaborated by ANRE is published and covers both the procedures for accreditation of the ERES producers and the GC market. There are 4 pending documents to be elaborated, none of which has an impact on the application of the law. 2

3 Primary Legislation On July 13, 2011 the EU Commission approved the promotional scheme based on Green Certificates set forth in Law no. 220/2008 The Romanian Government approved the Emergency Ordinance no. 88/2011 for amending and completing the Law 220/2008 (“EGO”) and it was published in the Official Gazette no. 736 on October 19, The EGO will be applied starting November 1 st (the date when the secondary legislation was published in the Official Gazette) The procedure requires for the EGO to be debated and validated by the Parliament (Senate and Deputies Chamber). The first debate in the Senate was held on November 8 th. 3

4 Primary Legislation The main amendments brought to Law 220/2011 by EGO 88/ Overcompensation principle introduced based on IRR (an IRR of 10.9% is established as a reference for wind projects) 2.Guaranteed access to the grid introduced 3.Distinction between “accreditation” and “qualification” 1.One (1) GC will be received during the testing period 1.The period for which the RES-E producers benefited from GCs prior to the applicability of Law 220/2008 will be deducted from the period of the newly introduced promotion system 2.New formula for cumulating EU funds or Environmental funds with GCs; 4

5 Primary Legislation 7. The GCs will be valid for a period of sixteen (16) months 8. Until the national targets are achieved (i.e – 33%, 2015 – 35%, 2020 – 38%), the sale of RES-E benefiting from the promotion system under Law 220/2008 shall be carried out only in order to cover the electricity energy gross final consumption of Romania 9. GC price (EUR 27 to 55 / GC) and the penalty for un-purchased GC (EUR 110 / un-purchase GC) will be subject to indexation with the Euro zone inflation rate announced by EUROSTAT for the previous year and not the inflation rate of EU Individual authorization for RES-E project with an installed capacity higher than 125 MW 5

6 Secondary Legislation The secondary legislation was published in the Official Gazette and therefore entered into force starting November 1 st Regulation for Accreditation of the E-RES producers (Order 42/2011) Regulation for issuing green certificates (Order 43/2011) Regulation for organization and functioning of the green certificates market (Order 44/2011) Methodology for establishing the annual quotas of purchasing green certificates (order 45/2011) The above documents can be found in English on 6

7 Secondary Legislation The Regulation for Accreditation is the new version of the Qualification Regulation and contains the description of the process to be followed in order for a producer to receive the green certificates including the necessary documentation, conditions, description of the application of the promotional system, rights and obligations of the producers. The existing producers have 30 days to submit the documentation in order to be accredited. Regulation for Issuance of Green Certificates lists the obligations of the TSO, DSO and economical operators (producers) during the process of issuance of GCs. It also describes the procedure to register with Transelectrica in order to receive the GCs. Regulation for Organization and Functioning of the Green Certificates Market applies to the participants on the GCs market and to the operator of the energy market OPCOM. OPCOM manages the transactions of GCs trough the two markets: the market of bilateral contracts and the centralized market. OPCOM also manages the Register of Green Certificates and sends monthly reports to ANRE. Lastly, the regulation provides details about invoicing and balancing payments. 7

8 Secondary Legislation Methodology for establishing the annual quotas of purchasing green certificates A. Establishes the estimated purchasing quota of GCs for the next year by calculating the ERES quantity to be produced in the next year which benefits from support mechanism, calculating the total number of GCs estimated to be issued in the next year calculating the final consumption of electricity estimated for the next year B. Establishes the maximum ERES estimated to benefit from support mechanism C. Establishes the purchasing quota of GCs for the current year D. Establishes the level of achievement of the quota and calculates the penalties 8

9 Pending Secondary Legislation “Methodology of monitoring the energy from renewable sources and of the support mechanism” is published on ANRE website for public debates (elaborated by ANRE, dead line for debates November 15) Guarantee of the intake of green certificates in excess after achieving the quotas (currently not mentioned in any document, the only Governmental Decision on this subject was abrogated by the EGO) Common agreements with other states on transferring quantities of electricity, joint projects and harmonization of the support mechanisms (elaborated by the Ministry of Economy, dead-line not specified) Regulation of issuance and monitoring of Guarantees of Origin (elaborated by ANRE, dead-line: 3 months from entering to force of the present law) 9


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