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The Romanian Energy Regulatory Authority’s New Capacity Allocation Process
The Romanian Energy Regulatory Authority (ANRE) is taking significant steps to address the network congestion issues by implementing a competitive process for allocating capacity for power plant projects. Over the years, investors, government bodies, and network operators have raised concerns that network overload and speculative renewable energy projects present major barriers to the energy transition, as reported by BalkanGreenEnergyNews.
Countries across Europe and beyond are competing to attract investments in renewable energy through various incentives, while often overlooking crucial aspects like digitalization, power lines, and transformers. In response, Romania has decided to enforce financial guarantees and require developers to compete for network capacity.
New Methodology for Network Capacity Allocation
ANRE has introduced a new methodology for the distribution of network capacity. The surge in projects, particularly in wind and solar energy, is overshadowing the current and planned capabilities for their integration into the electrical system. This new order replaces the existing capacity allocation mechanism, which was based on auctions that mandated applicants for grid connection to contribute to the enhancement of the electrical network before their connection point.
Through the proposed auction-based capacity allocation mechanism, network operators will utilize the collected funds to advance the development of the power grid. Starting in 2026, companies planning to install energy production and consumption facilities, as well as energy storage batteries with a capacity of 5 MW or more, will only gain access to the grid through auctions.
Responsibilities of Transelectrica
The Romanian transmission system operator, Transelectrica, is tasked with publishing the available capacity for each zone annually by January 15. They will determine the starting price based on the costs required for the necessary network development. Companies can submit applications, including those in the electricity distribution segment, until the end of February.
Transelectrica is also required to conduct an annual study by June 15, revealing available capacity, starting prices, and auction dates. Auctions will commence on July 1 for each year within a ten-year period, starting from the second calendar year following the auction.
New Requirements for Project Developers
Another significant change introduced is that project developers with projects larger than 1 MW are now required to present guarantees equivalent to 5% of the connection fee before obtaining technical approval for connection. This new auction-based mechanism is anticipated to foster a competitive environment that provides predictability for the development of energy sources within the energy system.
According to ANRE representatives, the importance of the auction mechanism lies in the ability of applicants to secure the necessary capacity for subsequent grid connections. Moreover, the new mechanism will provide network operators with the essential funds to carry out the additional work needed for developing the power grid to connect new generation facilities.
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