FAQ

FAQ

What is a green certificate (GC)?
A green certificate means the certificate proving that a certain quantity of electricity is generated from renewable sources. Green certificates may be traded in a regulated market, separately from the electricity amount they account for, as provided by law.
Which are the minimum and maximum prices of GCs, and how are they established?
The price of Green Certificates is capped and floored, until 2025, at € 55/GC (inflation adjusted – for September 2012 is € 55.93) and € 27/GC (inflation adjusted – for September 2012 is € 27.6) at the beginning of each year.
The minimum price is imposed in order to support the bankability and financing of the projects for the producers/investors and the maximum price to protect end users/consumers. Cap and floor values are adjusted yearly with inflation (EU27).
The GCs price is established by supply/demand factors, and, agreed by the producers and traders or suppliers of electricity.
How many GCs are awarded to solar PV and what is the value of 1 (one) GC?
Solar PV is awarded with six green certificates for each 1 MWh produced and delivered to the power grid by producers. The price of 1 (one) green certificate may vary within a fixed band from minimum of EUR 27 to maximum EUR 55, subject to indexation. The GCs support scheme will apply for the electricity producers in new generating plants for a period of 15 years.
What is the mandatory quotas of RES benefiting from GC support scheme?
A new incentive scheme for the energy produced by RES, was approved in July 2010 (Law 139/2010, revising the law 220/2008) and was reinforced by the Government Emergency Ordinance (GEO) number 88/ October 12 2011. According to this, Romania has set the annual National Quotas for electricity produced by RES aiming to reach the maximum level by 2020.
How can a producer sell its RES-E?
In accordance with Energy Law 13/2007, Law 220/2008 and of regulation regarding the organized trading frame of bilateral electric energy contracts, (“Regulation”) the electric energy, including RES-E, can be traded at market price. Producers from electricity from RES have priority access to the transport and distribution grid.

Trading on the organized frame of the bilateral electric energy contracts can take two (4) forms:

– Trading on the organized market of bilateral energy contracts, where the contracts are awarded through public tender. The form of the bilateral contract, provided by the Regulation, is not mandatory, but it is forbidden to include clauses which will allow the parties to modify the bilateral contracts based on a future agreement. In consideration of the term for which such bilateral contracts can be concluded, there is a minimum term of one (1) month, but it is not mentioned a maximum term.

– Trading on the organized market of bilateral energy contracts, where the contracts are awarded through a mixed of tender and negotiation procedure. The form of the contract, as it is provided by the Regulation, is standard and mandatory. Regarding the terms for which the bilateral contracts, traded under this scheme, can be concluded, are standard too (i.e. 1 week, 1 month, 1 quarter and 1 year).

– Trading on the spot market is also supervised by OPCOM. In order to participate to the spot market, the producer must first register with OPCOM. This market is typically used by its participants to supplement the required quantities of energy or to sell the excess of electricity.

– Trading of the electricity by using PPAs. In accordance with Law 13 the producers of electricity may negotiate with the suppliers/trader at a market /negotiated price of electricity (e.g. Enel, REPower etc.)

Can/will ANRE reduce the number of GCs during the contract period for existing PV plants?
Reduction of the GCs in case the producer benefits from state aid

As per Law 220/2008 regarding green certificates support scheme and Order 42/2011 pertaining to the accreditation of the producers for green certificates support scheme, the beneficiary benefiting from state aids will face reduction of the green certificates. The reduction applied will be performed so that the beneficiary will have same IRR as it would have had in lack of any state aid. This reduction will be imposed on the existing RES-E production facilities.

– Reduction of GCs caused by overcompensation

As per Law 220/2008 article 29, third paragraph, the measure of GCs reduction caused by the overcompensation will be taken following a Government Decision (“GD”). The provisions of such GD will apply only to production facilities which will start producing RES-E after the enactment of the GD.

What is the purpose of approved IRRs?
The IRR, as they are established for each RES-E producing technology which may qualify for the GC support scheme, were submitted by Romania to the EU for approval. Such step was necessary because the provisions of GC support scheme are considered state aid and as consequence such measures must be first approved by the EU. The EU decision approving the GC support scheme and the IRR rates is C (2011) 4938 dated July 13, 2011.

For the avoidance of a support scheme which could distort the energy market, IRR rates are provided for each technology of producing RES-E. If ANRE determines that a certain technology generates higher IRR then the approved ones, it may initiate procedures to rebalance the factors that generated higher IRRs. The most probable measure to be taken is the reduction of the GCs for the technology which generates IRRs higher then approved quotations.

According to the new amendments of latest Romania energy law, the current number of GCs allocated to each type of technology cannot be decreased (for new projects, ed.) , before January 1, 2014 for solar and before January 1 , 2015 for other technologies.

When does the producer get the money for its GCs?
The seller should receive the money for the sold GCs at the agreed terms in case of trading with Bilateral GC contract market or in five (5) days after the invoice has been received by the buyer in case of trading on the Centralized GC market.
What is the validity of a GC? What will happen if the producer cannot sell its GCs ?
In accordance with Law 220/2008 as recently amended and of Order 43/2011 of ANRE, the validity term of the GC is of sixteen (16) months starting from its issuance by the TSO. If during this time the GC is not sold it will be cancelled. At the moment the relevant legislation does not give a solution for the oversupply of GC.

It is generally viewed as a commercial risk which the producers of RES-E must take into consideration. Although the risk of GC oversupply cannot be excluded, it is unlikely that in the next couple of years the RES-E which benefits from the GC support scheme to surmount the obligatory quota established by Law 220/2008.

The Romanian authorities review all related issues mainly in terms of the necessary budgetary/fiscal support, the overlapping with the Environment Fund (where penalties collected to be used in promotion of domestic/roof top household PV facilities, such schemes exist in other European countries).

OPCOM has declared that the regulatory framework for the functioning of the Warranty Fund is being prepared and that ANRE has to approve also before the Government decides to enact this in National legislation. There is no definite timeframe for this.

Is there any fee per green certificate which the producer has to pay to the TransportSystemOperator in order to get the green certificates?
Currently, the national owned and operated Transmission System Operator (TSO – Transelectrica – “TSO”), does not impose a certain fee in order to register and receive the green certificates. Moreover, OPCOM, which is the organizer of the centralized GC market, does not impose fees for registration or for the trading of the GCs. Nevertheless, it is possible that the situation will change in the future as the procedures are being presently updated to include the amendments brought to the legislation pertaining to GC trading.
How and when can the producer obtain the GCs?
In accordance with Order 43/2011, TSO shall issue the GC within four (4) working days as from the date the producer of RES-E informs the TSO of the produced RES-E. The producer must submit each month to the TSO the quantity of RES-E which benefits from the GC support scheme.