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Is it going to be or not an inflation of GC after the issue in 2018 of GC postponed for the energy produced by wind plants?

All changes that occurred in the last year in respect of the energy produced from renewable sources of energy have created uncertainty and instability regarding new investments in this field. Is the situation as bad as it looks? The measure to postpone GC until 2018, shall create inflation of GC on the market and shall place the decision factor from the hand of producer of energy from renewable sources into the “select” hand of purchaser?

After the amendments brought to Law 220/2008 establishing the promotion system for energy production from renewable sources of energy („Law 220/2008”) by the Government Emergency Ordinance 57/2013 („GEO 57/2013”), certain aspects regarding the issue of green certificates have been approached in a more detailed and elaborate manner in the legal provisions of Order of President of the National Agency for Energy Regulation (A.N.R.E.) 56/2013 amending and supplementing the Regulation to issue green certificates as approved by Order of the President of A.RN.R.E. („Order 56/2013”), as published in the Official Gazette of Romania no. 472 of 30.07.2013.

According to the amended legal provisions of Law 220/2008 as well as of Order 56/2013, during the period 1 July 2013 – 31 March 2017, from the number of GC issued according to the provisions of art. 11, the transport and system operator shall postpone from trading on the GC market, including from the transfer from the producer account into the supplier account for the accomplishment of the annual binding acquisition quota of GC, a number of GC according to the provisions of art. 6 par. (2¹) of Law 220/2008, as amended. Law 220/2008 stipulates that in the relevant period also indicated by Order 56/2013, it will be postponed one green certificate for wind electric plants from the two green certificates issued for each 1 MWh produced and delivered by producers of energy from wind power.

The procedures to issue green certificates granted to accredited economic operators, for the energy produced from renewable sources of energy, stipulates that the number of GC postponed from trading, including from transfer from the account of producer into the account of supplier for the accomplishment of annual binding acquisition quota of GC is distinctly registered on each individual economic operator, and their code and number shall be communicated on a monthly basis both to producers and ANRE and OPCOM, pursuant to provisions of Regulation to issue GC approved under ANRE Order 43/2011, as subsequently amended and supplemented.

The recovery of green certificates postponed from trading of producers of energy from wind power shall be made in tranches, as from 1 January 2018 until no later than 31 December 2020. The method by which the postponed green certificates shall be recovered shall be established by A.N.R.E. and shall be approved by order of the president of the institution.

GC postponed from trading shall be recorded in a distinct manner in the Register for beneficiaries of green certificates and of green certificates issued, and shall be recovered monthly, until 31 December 2020, in tranches, in accordance with the Procedure of CN Transelectrica SA for the issue of GC as approved by ANRE Approval 31/28.08.2013.

It is provided that, as from 1 January 2018, for the wind plants, it will be recovered
a number of GC for each calendar month of the recovery period equal to the multiplication between
(a) average number of GC postponed for each calendar month of an year and
(b) rate between
(i) total number of GC postponed from the postponement period and
(ii) total number of GC for their recovery period
established by using the number of GC postponed for each calendar month of an year mentioned above, with the recovery of total number of CG postponed.

Under these circumstances, beginning with the recovery in tranches for the period 1 January 2018 – 31 December 2020, practically the economic operator who already has an operational wind project, shall receive until 2017 one GC for 1 MWh produced and delivered into the grid, and after 2018, it will receive 1 GC plus a number of GCs postponed which shall be recovered according to the method stated above, stipulated by the Procedure of CN Transelectrica SA for the issue of GC. The projects accredited after 1 January 2014, shall receive 1.5 GC for each 1 MWh produced and delivered in the grid until 2017 and 1.75 GC for each MWh produed and delivered into the grid.