New amendments to the Energy Act were promulgated on May 21st 2019 with the objective to continue the liberalization progress on the electricity market. This will improve the market liquidity and will contribute to the credibility of the market reference price.
The latest amendments are based on the previous market integration of renewable and co-generation power plants throughout 2018.
Key amendments include the following:
- The feed-in tariffs for RES with installed capacity of 1 MW or above will be transformed into feed-in premiums. The same transition will apply equally to electricity generated from highly efficient co-generation (Co-Gen) with installed capacity of 1 MW or above;
- Renewable and Co-Gen power plants with installed capacity of 1 MW to 4 MW will start operating on the liberalized segment of the market. The compensation they will receive is the difference between the forecast market price and the feed-in tariffs (which will be the feed-in premium);
- NEK will no longer have an obligation to purchase electricity from renewable and Co-Gen plants with installed capacity of 1 MW or above;
- The Electricity Security Fund will become the financial counterparty to all contracts for premium payments for power plants with installed capacity of 1 MW or above. The feed-in premiums for these producers will be payable by the national Security of Electricity Fund only;
- The respective power generator (RES or Co-Gen) and the Fund will enter into a premium compensation agreement;
- Other notable changes include:
a) Administrative relief for small generators related to statutory reporting and submissions to the Fund;
b) The creation of a new mechanism for investments in renewable power generation capacity – tender for feed-in tariff or premium for highly efficient co-generation in compliance with the EU rules on state aid;
c) Improvements in the regulatory competence and discharge of powers of the energy regulator (EWRC).