Recent developments and trends in the Slovak Republic renewable energy legislation
Lubos Frolkovic and Adam Pichler
Wolf Theiss
Bratislava
Lubos Frolkovic (Bio)
Adam Pichler (Bio)
In December 2010, the Slovak parliament adopted an amendment to the Act No. 309/2009 Coll. on promotion of renewable energy resources and high-efficiency cogeneration (the Act), becoming effective as of February 1 2011 (apart from some provisions becoming effective as of April 1 2011). Since the adoption of the Act, which started a boom of the solar power business, the costs for technology have significantly decreased (mainly due to the decreasing prices of photovoltaic components), which, in connection with the conditions set out by this act, have led to excessive interest of investors in building new solar and wind power plants in Slovakia. By means of the amendment, the Slovak parliament has introduced some changes, whereby the emphasis shall be on electricity produced from biomass rather than from solar and wind power.
According to the current Slovak government, which proposed the amendment, the production of electricity from solar power shows major fluctuations and thus cannot be considered as stable. The uncontrolled building of such unstable solar plants can cause serious risks in ensuring the reliability and safety of the Slovak electricity system. Moreover, due to high off-take prices, these resources also have a negative impact on the final price for the customer. Based on these grounds, the Slovak government has proposed to amend the Act.
National Action Plan
In this respect, the Slovak government has also adopted a National Action Plan for renewable energy sources in October 2010. The plan will see the Slovak Republic committed to increase its use of renewable energy resources compared to the gross final energy consumption to 14% until 2020. In 2005, the use of renewable energy resources represented 6.7% of the gross final energy consumption. Under the plan, the above mentioned commitment of the Slovak Republic will be met first and foremost by supporting the generation of heat from biomass. Biomass first received attention as an alternative energy source after the price increase of fossil fuels in 2008.
The intention of the amendment to the Act is to react to the current photovoltaic boom. However, the changes do not affect solely solar power, but also alternative energy resources in general, and can be summarised as follows:
- The feed-in tariff will only be provided as a form of support for solar power if the relevant power plants are located on buildings and have a total output of no more than 100 KW.
- Electricity prices for solar and wind power facilities will be determined by the Regulation Office for Network Industries of the Slovak Republic in such a way that the former provision under the Renewable Energy Resources Act – by which the price for each subsequent period, which shall not exceed three years, must not be lower than 90% of the price applicable in the previous period – will not apply to solar and wind production facilities.
* @06.3 firm text 2nd:One of the methods of the promotion of electricity from renewable energy sources is the transfer of the liability for deviations (i.e. the difference between the production of electricity and the demand thereof). According to the amendment, the liability for deviations between anticipated and actual output will be born by the operator of any solar plant with a total output more than 100 KW (currently it is born by the regional distribution grid operator). In general, the liability for deviation was decreased from 4 MW to 1 MW.
Certificate of compliance
A power-generating facility may only be built in the Slovak Republic with the prior approval of the Ministry of Economy, which examines the compliance of the applicant's investment plan with the nation's long-term energy policy. If the project complies with the energy policy, the Ministry of Economy issues a certificate approving the construction of the power plant (the Certificate).
In case of a facility the capacity of which does not exceed 1 MW, an approval of the Ministry of Economy is not required, except for facilities using solar power as a resource. Such a Certificate is generally required for the construction of any solar plants, except for facilities installed on buildings with a total output of less than 100 KW, whereby the Certificate is a prerequisite for the issuance of a building permit. Until May 2010, this exemption applied to solar plants with a total output of less than 1 MW.
An important prerequisite for the issuance of the Certificate is the affirmation of the transmission system operator (SEPS) that the power generating facility does not pose a risk to the stability of the transmission network. In this respect, SEPS adopted rules for issuance of statements approving new solar projects (Statement), in order to prevent uncontrolled increase of their numbers. The rules provide (among others) that the affirmative Statement may be issued only to those applicants having an individual installed capacity between 1 – 4 MW, subject to a maximum of 120 MW of aggregate installed capacity. The SEPS announced in December 2009, that the maximum limit of 120 MW of aggregate installed capacity was reached as of December 3 2009. Therefore, no other affirmative Statements will be issued to new applicants with respect to solar energy.
SEPS has also indicated that it will adopt regulations regarding solar projects and, in all likelihood, will issue new affirmative Statements only after acquiring sufficient practical experience with operation of relevant solar energy generators (which will be built until the end of 2011). Until then, no other affirmative Statements will be issued to the solar projects, and as a consequence, no further solar projects exceeding 1 MW will be built in Slovakia.