As a step in the direction of open Government, various Ministries in Romania sometimes issue draft laws for consultation purposes.  This is an improvement from the past when laws were, and sometimes still are, introduced without consultation.  We are therefore today considering a draft law issued by the Department for Energy.

Renewable energy and its funding in the short and medium term is still an issue for many Governments who are trying to come to terms with the new technology.  Romania’s Government is therefore not alone in this regard and they are continuously reviewing the position.

On 1st October 2014, on the website of the Department for Energy was published a draft law, which is to supplement Law No. 220/2008 regarding the aid scheme for the generation of electricity from renewable energy sources. The draft also introduces changes to the provisions of Government Emergency Ordinance No. 88/2011 which amended and supplemented Law No. 220/2008.

We have analysed these draft law considering the objectives envisaged by the legislature, and have tried to explain the main changes as set out in the draft.

According to the current provisions, electricity producers and business operators could benefit from temporary accreditation by the National Regulatory Authority for Energy (Authority).  They can do this if they were exploiting installations for producing electricity from renewable energy with a capacity exceeding 125 MW at the date of entry into force of the Government Emergency Ordinance No. 88/2011.  The Authority could issue green certificate for these electricity producers, but these would be valid only for two years. This possibility for temporary accreditation was conditioned to submitting the documentation required for the assessment of the aid scheme in relation to the respective project by the European Commission.

An important change to the current law provisions proposes giving to the electricity producers the chance to apply for a new temporary accreditation in order to receive green certificates from the National Regulatory Authority for Energy.  The new accreditation can be issued and received if the producers do not obtain individual authorisation decisions from the European Commission within twenty-four (24) months.  This will only apply if the reason for the non issue of the authorization is for reasons not attributable to the producers who have applied for accreditation.

According to the proposed draft law, the new accreditation shall be valid until the European Commissionshall issue the authorization decision. The same possibility is available for business operators developing power projects which produce electricity from renewable sources with an installed capacity greater than 125 MW.

If there are discrepancies between the number of green certificates issued under the European Commission’s decision and the number of green certificates received, such situation is to be resolved by the National Regulatory Authority for Energy. The Authority will issue a Decision in order to supply the number of green certificates, within a period no longer than 24 months after the European Commission’s Decision.

The urgency for such measures is that temporary accreditation issued by the Authority are expiring or are about to expire and therefore can affect the investors valuation of the renewable energy resources in Romania as well as destabilizing the green certificates market. Both of which will affect Romania’s position in relation to renewable energy.

From the date of the entry into force of this proposed draft law, the business operators who develop electric power generation facilities from renewable sources in sites where the output from every site exceeds 250 MW, will be able to prepare and submit the legal documentation necessary for the detailed assessment of the aid scheme by the European Commission.

The Draft Law also aims to provide the legal framework at a national level, harmonized with the European Union`s provisions in order to continue the functioning of large capacity electricity generation from renewable sources.  This should help future investors understand better the legal regime in Romania applicable to renewable energy.

One novelty introduced in the text of Law No. 220/2008 is the definition of the term “site”.  It is proposed to define it as the place where there can be individualized installations, with equipment necessary for producing electricity and situated in the same location and having a single connection to the distribution network.  It seems like the legislator  proposed to be more specific in order to define the emplacement of the power plant exceeding 250 MW.

Will the draft survive the consultation; will it become law before the Presidential elections who knows.  At least it is in the public domain for debate.