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New targets for renewable energy

Delia Nitescu

Directive no. 2009/28/EC on the promotion of the use of energy from renewable sources requires EU Member States to take appropriate measures or support schemes to encourage greater consumption of energy from renewable sources in compliance with specified national indicative targets. The 2020 target set for Romania by the Directive for the share of energy from renewable sources in gross final consumption of energy is 24% (a significant increase compared to its 2005 target of 17.8%). In order to achieve the mandatory 2020 national target, Romania has recently amended the national energy support scheme for creating opportunities of growth and employment of incentives in local electricity production of energy from renewable sources (E-Res).

The Romanian promotion system for producers of E-Res consists in a system of yearly mandatory quotas (the mandatory share of E-Res in the gross final yearly consumption of energy) combined with trading of green certificates (GCs). Energy suppliers have the obligation to purchase on a yearly basis a number of GCs equal to the yearly mandatory quota multiplied by the quantity of energy supplied annually to end consumers. If they don't comply with this obligation, they are sanctioned with quite a hefty penalty of €110 ($140) for each GC in shortfall (increased from the previous €70).

In order to meet the aforementioned 2020 national target, Romania has recently increased the yearly mandatory quotas of E-Res which benefit from the support scheme through GCs, as follows: 2010-8.3%, 2011-10%, 2012-12%, 2013-14% etc and for 2020-20%.

The producers of E-Res benefit from an increased number of GCs that will be allotted depending on the renewable source that they produce, as follows: (i) three GCs (previously one) for each 1MWh produced and delivered by the new hydropower plants and two GCs (previously one) for each 1MWh produced and delivered in the refurbished plants; (ii) until the end of 2017 (previously 2015) two GCs (one GC as of 2018) for each MWh generated using wind power and (iii) six GCs (previously four) for each MWh generated through solar power. The producers of E-Res that obtain GCs on the basis of the quantity of E-Res they feed into the grid are able to sell them only on the Romanian market of GCs and thereby an extra income can be obtained in addition to income generated by the sale of electricity.

The period, for which the trading value on the market of the GCs remains unchanged from 2008 through 2025 (previously 2014) and ranges from a minimum of €27 up to a maximum of €55 per GC. Starting with 2011, the trading value of the GCs will be indexed with the EU average inflation rate recorded in December of the previous year by the National Energy Regulatory Agency. Prior to reaching the national target, the GCs can be traded only on the Romanian market of GCs and once such target is achieved the producers and suppliers of E-Res may trade the GCs on the European market.

In accordance with the requirements of Directive 2009/28/CE, Romania prepared the draft of the national renewable energy action plan which detailed the roadmaps of how it expects to reach its legally binding 2020 target for the share of renewable energy in its final energy consumption. According to such action plan, further amendments to the national energy support scheme for producers of E-Res will follow, in order to allow Romania to comply with its national target.

Delia Nitescu

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