Ivan Ivanov: The changes in the Ordinance on the connection of renewable energy sources will limit ambitions that are not beneficial for the Bulgarian energy sector

APSTE and ASEP representatives did not like part of the changes in Ordinance 6, regarding the connection of objects to the electrical networks, but others were supported.

However, ERM West representative Petya Shikova and Martin Velichkov from ESO declared full agreement. This became clear during the discussion in EWRC of the changes in the normative document. Later, comments were also made by the chairman of the commission's working group, Plamen Mladenovski, and the chairman of EWRC, Ivan Ivanov.

As expressed by the chairman of APSTE Nikola Gazdov, from the initial review of the proposals sent by the members of the association, it is clear that the proposed amendments are in conflict with the Law on Energy and the Law on Energy from Renewable Sources (ZEVI). He expressed confidence that, although no detailed analysis has been done at the moment, the changes to Regulation 6 "will fall in court" and expressed suspicion that it could have the opposite effect - that is, instead of being stopped, speculative pressure on the network will be strengthen.

Gazdov recommended that such changes should not be made by EWRC, but should be made at the level of law. "A working solution should be sought and this should be done with ZE and ZEVI, not with decisions of the commission," he said.

ASEP representative Maria Krasteva expressed agreement with part of APSTE's reasons regarding the changes in three of the paragraphs of Ordinance 6, as in her words, "this adds to the law". In this regard, she, like Gazdov, questioned the legitimacy of the changes made by the energy regulator. According to her, it is also too early the stage of the introduced restrictions, and that without being based on data from the ESO on submitted applications. At the same time, ASEP also expressed a positive opinion, especially regarding the introduction of property rights.

The participants were divided on the introduction of a BGN 50,000 guarantee in relation to RES projects, but most of them also expressed their agreement.

A meaningful argument?

"The changes in Ordinance 6 are grouped into 3 main groups. For two of them I heard only support. The disagreement was only with the introduction of a deposit and the unification of the approach to RES and the joining of RES. From the statement of Mr. Gazdov and Mrs. Krasteva, I did not hear a single meaningful argument that refutes the existence of such a guarantee. It was pointed out that the court would fall. This is for the court to decide," commented the chairman of the working group, Plamen Mladenovski. According to him, the two laws are clearly confused - the Energy Act (EA) and the Renewable Energy Act (REA).

"They say it should have been in law - batteries are under the Energy Act, not ZEVI, so don't draw parallels. It is clearly stated in the Energy Law that the terms and conditions for the connection of batteries are regulated by Ordinance 6, that is, the powers of the commission to issue this act have been fully delegated," stated Mladenovski. "I didn't hear a meaningful argument," he repeated, giving an example of what is being done at the moment - bypassing ZEVI, reserving capacity supposedly for batteries without having suitable land, which (capacity) is then resold to subsequent investors. Exactly what ZEVI is trying to do with the introduction of guarantees, he reminded. According to him, loopholes are now being found and the same is being done but through the batteries. According to him, regardless of the fact that the network companies invest in new capacity, it is occupied for a negative time and without serious intentions. In response to Gazdov's comment, Mladenovski referred to members of the association who said how speculative capacity booking is done.

"Now, the main purpose of this measure, by ensuring equality of producers with storage facilities, is a bit preventive and aims not to further clog the network, as happened a few years ago," said Mladenovski, expressing an expectation that it will have an effect.

"The changes we are making in Regulation 6 are urgent and are aimed at avoiding some opportunities for abuse. It was stated that by introducing the so-called deposit of BGN 50,000 per MW for an energy storage system, we will repel investors. This is not true. If you look at the other part of the changes, where we ease the administrative procedure regarding the establishment of property rights, we give a much greater opportunity, in a much shorter time frame, to carry out investments and development of energy production from RES," said for his part, the chairman of EWRC, Ivan Ivanov. According to him, it should be noted that the energy regulator aims to encourage investor interest in RES production.

"Regarding the introduction of a deposit of BGN 50,000, let's remember what was the reason for this - precisely the argument that in this way the real investors will be screened from the fictitious ones, whose goal is only to reach the resale phase on the ground and what has been achieved as prior permissions," he added.

The chairman of the energy regulator also commented on the placement of the sites for energy production from renewable energy sources and for energy storage in a level playing field. "Whether the energy facility is for energy production or storage in either case requires serious investment in either case. The purpose of the commission is to realize the true investment intentions. We do not favor one site or another. The goal is to achieve equality," he said, asking the question on what grounds this could be attacked.

"The sooner these changes are made, the sooner the ambition of some whose plans are not beneficial for the Bulgarian energy industry will be limited," concluded EWRC chairman Ivan Ivanov.

The Commission for Energy and Water Regulation will rule on the changes in Ordinance 6 after a closed session on September 19 this year. Within 14 days, the parties may submit opinions and comments.