This content is from: Local Insights

Renewable electricity

Recently the Slovak Republic, in an attempt to foster the attractiveness of investments in renewable energy technologies and to meet the country's EU targets, adopted a bill on the promotion of the renewable energy and high-efficiency cogeneration (RES Promotion Act). Main incentive schemes will enter into force on January 1 2010.

According to the RES Promotion Act, production of electricity from RES and electricity from high-efficiency cogeneration shall be promoted through the (i) priority access to the grid, (ii) mandatory off-take of the electricity by the regional distributor, (iii) supplement payable by the regional distributor and calculated as a difference between commercial electricity price and the RES feed-in tariff and (iv) assumption of the liability for the deviation from agreed injection schedules (applies only to the installations below 4MW of capacity).

The right to the mandatory off-take for the off-take price and to the electricity price supplement pertain to the installations whose capacity is up to 125 MW. However if the installation's capacity exceeds 10 MW (or 15 MW in the case of wind-power plants), the supplement will only be granted for the RES electricity, pro rata to 10 MW (15 MW for wind-power plants) with respect to the total installed capacity. The supplement is payable by the regional distributor to the producers of RES electricity that meet the qualifying conditions regardless of whether they supply the RES electricity to the grid or use it for their own consumption.

The mandatory off-take for the off-take price, the right to the supplement and the deviation assumption will apply for 15 years from the year the installation was put into operation or upgraded, and the feed-in tariff will be guaranteed for the same period. Installations up to 1MW enjoy the right to the off-take, priority access and deviation assumption for their lifetime.

For other projects in the pipeline the regulatory authority may gradually reduce the feed-in tariff by not more than 10% of the feed-in tariff applicable in the immediately preceding regulated period.

Current feed-in tariffs determined by the regulator for the projects put into operation on or after January 1 2009 are: 112.86 €/MWh for hydropower (installations with less than 1MW capacity), 101.57 €/MWh for hydropower (1MW-5MW installations), 448.12 €/MWh for solar energy, 84.64 €/MWh for wind energy, 195.84 €/MWh for geothermal energy, 129.46 €/MWh for waste-biomass combustion and 116.18 €/MWh for combustion of purposely grown biomass.

Although biomass and geothermal energy are perceived as particularly promising energy sources, the transmission operator remains quite concerned about wind and solar electricity as being unpredictable and volatile thus imposing risks on the transmission system. For this reason, it has temporarily withheld its consent for any RES projects until there are laws laying down criteria for regulating unpredictable RES electricity (above all, wind and solar sources).

Andrej Schwarz

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