During the Paris Conference of the Parties to the United Nations Framework Convention on Climate Change Portugal made a commitment to achieve carbon neutrality by 2050. This commitment resulted in the approval of the Roadmap to Carbon Neutrality 2050 ("RNC 2050") and of the National Energy and Climate Plan 2030 ("PNEC 2030"). "This plan will act as the primary tool for shaping national energy and climate policies in the coming decade, aiming to facilitate the shift towards a carbon-neutral future.
The PNEC 2030, recently subject to a revision and update proposal, addresses key aspects like lowering greenhouse gas emissions, integrating renewable energy sources, enhancing energy efficiency, ensuring energy security, considering the internal market, and fostering research, innovation, and competitiveness, the plan establishes a clear roadmap to achieve its objectives effectively.
To respond to this changing landscape, also the rules governing the National Electricity System ("SEN") have been adjusted, resulting in the approval of Decree-Law 15/2022, of 14 January ("Electricity System Law").
The main focus of new Electricity System Law has been to change the electricity production rules, with an emphasis on decentralized forms that rely on local production and self-consumption. This approach required a significant revision of the permitting procedures. Additionally, regulations were established to promote and regulate the upgrading and expansion of electricity production from oceanic sources or locations to reduce pressure on land-based resources.
The second cornerstone of the Electricity System Law has been to optimize the use of the public service electricity grid ("RESP") by introducing new rules into the development and investment plans of both transmission and distribution networks. This is essential to fully utilize the grid's potential and ensure its efficient operation and growth.
Finally, there has been a push to include competitive procedures for the licensing of several activities within the National Electricity System, to promote fairness and competition in these areas of the electricity sector. Rules such as those in the Electricity System Law establishing the obligation to use competitive procedures to select the Last Resort Supplier (“CUR”) and the Entity Responsible for Issuing Guarantees of Origin (“EEGO”).
Throughout this study, we will address these and other matters governed by Electricity System Law.
1. GENERAL PROVISIONS
1.1. SCOPE
The Electricity System Law applies to the activities of generation, storage, self-consumption, transmission, distribution, aggregation and commercialisation of electricity, as well as to the logistical operation of change of supplier and aggregator, the organisation of the respective markets, the activity of issuing guarantees of origin, the activity of managing guarantees of the National Electricity System, the procedures applicable to access to those activities and consumer protection.
The Electricity System Law excludes certain activities from its scope, namely: (i) the production of electricity through cogeneration, which is regulated by Decree-Law 23/2010, 25 March; (ii) the production of electricity from waves’ energy in the pilot areas, governed by Decree-Law 5/2008, 8 January, and Decree-Law 238/2008, 15 December; (iii) the organization, access, and activities related to electric mobility, regulated by Decree-Law 39/2010, of 26 April; and (iv) the production of electricity from nuclear energy.
The Electricity System Law contemplates the following market participants:
- Electricity producers, responsible for generating and supplying electricity to the national electricity grids;
- Electricity stores, responsible for storing the energy produced by energy producers;
- Global Manager of the National Electricity System, responsible for ensuring the harmonised operation of the SEN, the security and stability of the electricity supply in the short, medium and long term, as well as coordinating a stable and secure electricity supply with other European countries;
- Integrated Distribution Network Manager ("Integrated ORD"), responsible for the technical management of the electricity distribution networks in high, medium and low voltage and for the technical management of the distribution networks in articulation with the Global Manager of the National Electricity System;
- Transmission System Operator ("ORT"), responsible for the activity of electricity transmission, and for the construction, operation and maintenance of the transmission system;
- Distribution System Operator ("ORD") of electricity in high and medium voltage, responsible for (i) the construction, operation, and maintenance of distribution networks, (ii) the management, operation, and maintenance of the electricity system, (iii) the expansion to new locations, (iv) the maintenance of the network and (v) connecting all consumers who request it;
- Low-Voltage Distribution System Operators ("Low-Voltage ORD"), responsible, in addition to commercial duties, for reading meters, making meter-reading data available to suppliers and invoicing and collecting network access tariffs by suppliers;
- Closed Distribution System Operators ("Closed ORD"), responsible for ensuring the capacity of the closed distribution system, i.e. for (i) interrupting the supply of electricity within the closed distribution systems, provided that this is duly justified and notified to ERSE, the Portuguese Energy Services Regulatory Authority or to DGEG, the Portuguese Department of Geology and Energy, (ii) knowing the consumption demand and energy produced by the closed distribution systems and (iii) entering into transparent and non-discriminatory agreements with consumers/users of the closed distribution system;
- Electricity traders, responsible for making commercial offers, buying electricity from electricity producers in the market and selling it to customers;
- Last Resort Suppliers ("CUR"), responsible for the supply of electricity, namely (i) in areas where there are no free market offers, (ii) to economically vulnerable consumers and (iii) to customers whose free-market supplier has been prevented from exercising its activity;
- Electricity Market Operators, responsible for managing the market and related activities, namely managing organised markets for contracting electricity, ensuring that the markets are provided with adequate settlement services and establishing the criteria for determining the price indexes for each of the different types of contract;
- Guarantees Manager, responsible for ensuring the management of the guarantees to be provided by suppliers or market agents;
- Last Resort Aggregator, responsible for acquiring electricity from producers of electricity from renewable energy sources and which is remunerated at a price freely determined on organised markets and for acquiring electricity from self-consumers who inject surplus energy into the RESP in the event that no electricity aggregators are offered on the market or when aggregators are unable to exercise their activity;
- Electricity Aggregators, responsible for buying electricity on the free market and selling it to customers who enter into an Electricity Supply Contract, subject to the terms and conditions agreed therein;
- Self-consumers are those who produce their own electricity from renewable sources and consume it themselves, rather than selling it back to the grid. They may store or sell their electricity, although these activities may not constitute their main business or professional activity;
- Citizens' Energy Communities (“CCE”), whether public or private, including, in particular, small and medium-sized enterprises or local authorities, whose main objective must not be the achievement of financial profit;
- Renewable Energy Communities ("CER"), whose main objective is to provide environmental, economic and social benefits to the members or localities where the community operates;
- Guarantees of Origin Issuing Entity, responsible for issuing Guarantees of Origin ("GO"), whose activity is subject to a license to be awarded under a public tender. Currently, the activity is entrusted to REN - Redes Energéticas Nacionais, S.A. (“REN”) for electricity produced from renewable energy sources;
- Collective Self-Consumption Management Entity ("EGAC"), responsible for managing and communicating with the self-consumption and renewable energy community platform and connecting self-consumers to the RESP. They are also responsible for the commercial relationship to be adopted for the surplus energy produced by self-consumers;
- Logistics Operator for Switching Electricity, responsible for operating the change of supplier and aggregator in the electricity markets and providing personalized information to consumers, electricity producers, and self-consumers; and
- Electricity Consumers, typically residential and commercial customers. They are also responsible for, among other things, (i) making the relevant monthly payments, (ii) contributing to the development of energy efficiency, (iii) keeping their equipment in a safe condition, under the terms of the applicable legal and regulatory provisions.
The electricity generation and storage activities are subject to a permitting procedure (or prior control, as referred to in the Electricity System Law).
The following activities will require aproduction and a operating license:
- Production of electricity from non-renewable sources;
- Production of electricity from renewable energy sources for injection into the RESP network or for self-consumption with an installed capacity exceeding 1 MW;
- Autonomous storage of electricity with an installed capacity exceeding 1 MW;
- Autonomous production or storage when subject to an environmental impact assessment ("AIA") or environmental incidence assessment ("AINCA"); and
- Other production or storage activities non-exempted from prior control or not subject to prior registration or prior communication.
The permitting for other activities is less demanding. A prior registration and an operating certificate will be sufficient for:
- Production of electricity from renewable energy sources for total injection into the RESP, with an installed capacity equal to or less than 1 MW;
- Production of electricity for self-consumption with an installed capacity greater than 30 kW and less than or equal to 1 MW;
- Autonomous storage of electricity with an installed capacity equal to or less than 1 MW;
production, storage and self-consumption activities with an installed capacity greater than 30 kW.
- Small dimension producers must only serve DGEG with a prior noticefor:
Research and development projects, demonstration and testing in real environment of innovative technologies, products, services, processes and models, within the scope of production, storage and self-consumption activities with installed power higher than 700 W and less than or equal to 30 kW;
The refitting of an electro-production centre, of primary solar or wind source, when it maintains or reduces the installed power initially established in the prior control procedure.
Finally, the following are exempt from prior control: (i) the production of electricity for self-consumption with an installed capacity of 700 W or less, as long as the injection of surplus into the RESP is not foreseen; (ii) research and development projects, demonstration and testing, in a real environment, of innovative technologies, products, services, processes and models, within the scope of production, storage and self-consumption activities with an installed capacity of 700 W or less, as long as the injection of surplus into the RESP is not foreseen.
2.1. CAPACITY RESERVATION TITLE
In most cases, the procedure to obtain a production license starts with the granting of a capacity reservation title ("TRC") issued by E-Redes - Distribuição de Eletricidade, S.A. (as the ORD), or by REN (as the ORT).
However, no TRC is required in the following cases:
- For Self-Consumption Production Units ("UPAC"), except those where the injection of surplus into the RESP is expected to be greater than 1 MVA;
- For hybridization;
- For over-equipment and stand-alone over-equipment; and;
- For the retrofitting.
When needed, promoters can obtain the TRC in one of three ways:
- Under the general access regime, when there is capacity available in the RESP;
- By agreement with the grid operator, when, in the absence of available capacity in the RESP, the developer assumes the costs of strengthening the RESP to allow the connection of its project;
- By award in a competitive procedure, when the competent authority, subject to tender the capacity available in the RESP.
The award of the TRC is subject to the provision of a deposit to ensure that the promoter obtains the respective production license, with the following amounts:
- € 10,000/MVA (up to a maximum of €10,000,000), in the general access mode;
- € 15,000/MVA (up to a maximum of €10,000,000), in the form agreed with the network operator.
In competitive procedures, the amount of the deposit is defined by DGEG in the tender documents.
2.1.1. GENERAL ACCESS
When the general access regime applies, TRC applicants must file a request at the electronic platform created for the purpose by DGEG, after DGEG publishing the injection capacity available in the National Electricity Distribution Network (“RND”) and at the National Electricity Transmission Grid (“RNT”) at each substation of connection and voltage level.
The applicant submission must identify (i) the intended injection capacity, (ii) the chosen connection substation and voltage level, and (iii) the grid operator to which it wishes to connect.
The submission will automatically be rejected if (i) it does not refer to a substation in the DGEG list or it exceeds the total available capacity of the intended substation; (ii) the intended injection capacity has already been assigned or has been request earlier by another promoter; or (iii) after being notified by DGEG in 5 days from submission the promoter files to provide the deposit mentioned in the above section.
The TRC also requires prior compensation payment for the benefit of the SEN, in the amount of €1500/MVA.
Within 5 days from the deposit, DGEG forwards the request to the relevant network operator to decide within 45 days. The network operator follows the order of the requests received from DGEG, and may be refused the granting of new capacity in the following cases: (i) non-payment of the service fee; (ii) non-payment of the contribution to the SEN, (iii) there are no technical conditions to implement the requested grid connection, or it would affect the security and reliability of the RESP.
In case the grid operator notifies the applicant and DGEG of a favourable decision, DGEG will issue the TRC within 10 days.
2.2.2. AGREEMENT WITH THE NETWORK OPERATOR
If there is no available reception capacity in the RESP, promotor and the grid operator may enter into a grid reinforcement agreement, whereby the promoter assumes the financial costs arising from the construction or reinforcement of the grid necessary for the reception of energy from the production facility, storage or UPAC.
The negotiation of a grid reinforcement agreement (which will constitute itself the TRC) is conditional to an order from the Secretary of State for Energy until 5 January of each year, defining the maximum injection capacity at the RESP made available:
- By production technology;
- By RESP operator;
- By production with total injection into the RESP and production for self-consumption.
Although reality has been different to this date, the Electricity System Law establishes that:
Requests for agreements must be submitted to DGEG by 15 March of each year;DGEG must send them to the operator of the RESP within five days. The requests are accompanied by the provision of a guarantee;
By 10 August, the network operator, in coordination with the overall SEN manager or the integrated manager of the distribution networks, as appropriate, will proceed to prioritise the requests for agreement, proposing the approval of the provisional list with the requests accepted and excluded in accordance with the following criteria:
- Technical criteria for the safety and reliability of the SEN, namely those relating to the use of infrastructures and optimising the operation and management of the SEN;
- Criteria of territorial and environmental sustainability, namely those referring to the efficiency and rationalisation of infrastructure planning through the joint use of various interested parties, the obtaining of favourable prior information issued by the municipality, the existence of a favourable environmental impact statement, or the contractual title legitimising the use of the land necessary for the respective use;
- Targets that Portugal is obliged to meet according to the applicable technology.
- DGEG, after consultation with the grid operator, shall draft the final list within 10 days of the end of the prior hearing period, and notify the interested parties of it in the following 5 days.
- The grid operator must, in 10 days from the publication of the final list, provide the selected promoter with a budget for the execution of the network studies and the respective payment deadline.
- By 30 April of the following year, the grid operator shall send the following information to the selected promoters who paid for the studies: (i) the network studies, (ii) the cost of reinforcements or construction of the new infrastructure, including the criteria for allocation between interested parties, when applicable, (iii) the deadline for making the new infrastructure available, (iv) a proposal for agreement.
- The promoters have then a period of 30 days to accept or refuse the agreement proposed by the grid operator. In case of acceptance, the agreement must be executed until 30 November.
The agreement with the network operator must include:
- The rights, obligations and conditions to be observed, to add power injection capacity in the RESP;
- The injection capacity at the RESP assigned to the promoter;
- The charges, payment plan and plan for submission and release of guarantees.
With the signing of the agreement, the promoter must pay an amount corresponding to 5% of the budget presented by the grid operator. The remaining budget amount will be secured by a guarantee, which shall be subsequently released once the agreed payment plan is fulfilled.
2.2.3. COMPETITIVE PROCEDURE
The Secretary of State for Energy may launch competitive procedures for the allocation of a TRC for electricity production from renewable energy sources.
The procedure documents should define:
- The scope of the procedure and the launching method adopted;
- The conditions and criteria for the allocation of the TRC;
- The requirements for the qualification of interested parties;
- The electricity production remuneration models admitted and the respective access, duration and maintenance conditions;
- The deadlines for entry into operation; and
- The amount of the required deposit.
When a decision is taken to start a competitive procedure, all pending TRC requests for the same grid connection points that will be included in the procedure are immediately voided. And the respective deposit will be returned within 10 days from the procedure's opening date. However, the competitive procedure cannot include grid connection where there is an agreement between the interested party and the grid operator or where the applicant has already paid for the grid reinforcement studies.
2.2.4. TRANSFER OF THE TRC
Holders of a TRC can, subject to the consent of DGEG, transfer it before the respective production license is issued. A TRC transfer is deemed to occur whenever there is:
- A transfer of the project itself,
- When a change of control over the TRC holder occurs, being in any case subject to the consent of the DGEG.
The change of ownership of a TRC also depends on the promote providing a reinforcement of the guarantee in half of its initial value, except when:
- The TRC is transferred to a SPV - a vehicle company whose corporate purpose includes the exercise of the activities of construction and operation of an electricity generation plant, storage facility or UPAC, as the case may be, and which has as its sole shareholders the holders of the TRC;
- The shares are encumbered in favour of financing entities, changes in the direct ownership of the holder resulting from the execution of pledges of shares under agreements entered with the same financing entities, or changes in direct ownership under group restructuring operations that do not imply a change in the beneficial owner.
2.3. PRODUCTION LICENSE
The installation of 1MW or plus electrical generation plants can only begin after a production license has been obtained.
The procedure starts with the presentation of an application to DGEG for the granting of a production license with a set of documents specified in Annex I of Electricity System Law, including (a) a copy of the TRC; (b) proof of the right to use the land where the installation will be installed, (c) a description of the project and technical documentation relating to it, and (d) favourable environmental opinions, if applicable.
DGEG has 15 working days to decide on the reception of the application and may request additional information only once. The production license holder must provide the requested information within 30 working days.
The application for a production license must be filed within a maximum period of 1 year from the award of the TRC if the project is subject to AIA. Otherwise, this deadline is reduced to 6 months.
These deadlines may be extended at the request of the applicant:
- To DGEG, only on time and for a maximum period of 1 year, if de delay arises of reasons not attributable to the applicant; or
- To the Government, for an indefinite period, where in exceptional and duly justified circumstances the time limit proved to be insufficient.
The holder of the production license is entitled to:
- Install the electricity generation plant, the UPAC or the storage facility according to the terms of the production license;
- Sell electricity in organised markets or through bilateral contracts and buying electricity up to the limit of the injection capacity defined in the production license;
- Establish and operate direct lines to supply electricity to end customers when this cannot be done through the RESP or when it is technically and economically more advantageous for the SEN, in accordance with DGEG’ assessment;
- Deliver the electricity produced to CUR, against payment of the guaranteed remuneration if the plant benefits of a FiT;
- To deliver the electricity produced, to an aggregator or supplier, against payment of remuneration at a price freely determined between the parties; and
- Selling storage capacity to third parties.
On the other hand, the duties of the holder of the production license are, namely:
- Comply with the provisions of the production license;
- Obtain licenses, authorisations or opinions required for the installation and operation of the plant, UPAC or storage facility;
- Notify DGEG and the respective grid operator of the conclusion of the electrical installation;
- Send DGEG and ERSE data regarding the operation and exploitation of the electricity installation: (i) by the 15th of each month, the data referring to the previous month, (ii) by the end of March of each year, the annual data referring to the previous calendar year;
- Establishing and keeping insurance up to date that guarantees the civil liability of the holder of the production license arising from the exercise of the activity;
- Informe DGEG in advance, who will inform the grid operator, of any changes to the electrical installation that are not subject to obtaining a new production license.
2.3.1. EXPERIMENTAL SCHEME
Before starting operation of the power plant, UPAC or storage facility, it is possible to carry out previous tests and trials. These are subject to request by the holder of the production license and authorisation from DGEG and they may relate to units capable of operating autonomously (in the case of phased construction), or to the entire facility.
The application for authorisation to carry out tests and trials must be addressed to DGEG and accompanied by (i) the test programme to be carried out and its duration, signed by the technician or experts responsible for its execution, (b) the opinion of the grid operator to which the generating plant is connected, (c) a sworn statement by the holder of the production license that the installation complies with the terms of the respective license, the applicable regulations and the technical and safety conditions, and (d) a favourable opinion from the overall manager of the SEN.
DGEG will issue a decision on the authorisation request within 20 days from receipt of the application. It is considered tacitly granted if it is not expressly decided upon within that period and provided that the grid operator has given a favourable opinion on the existence of grid connection conditions.
The period for carrying out tests and trials and trial operation may not exceed:
- 3 months, except in exceptional circumstances recognised by DGEG; or
- 12 months, in the case of contractors of a competitive procedure for the award and TRC.
After the experimental operation period has elapsed, the continued operation of the electrical installation depends on the issuance of an operation license.
The energy injected into the RESP in the test and trial or experimental operation phase is remunerated at market price, through the signing of a contract with a market agent.
2.3.2. TRANSFER OF THE PRODUCTION LICENSE
The production license can be transferred by its holder, subject to the same regime applicable to the transfer of the TRC before the issue of the operating license, which includes an authorisation from DGEG.
The transfer request to DGEG must be accompanied by all the elements relating to the identification, technical and financial standing of the transferor, as well as by a declaration of acceptance of the transfer and of all the license conditions.
DGEG decides within 15 days and may request additional elements. The elements must be provided within a maximum period of 30 days, during which time the decision period will be suspended.
2.3.3. TERMINATION OF THE PRODUCTION LICENSE
The effects of the production license cease by expiry or revocation, implying the automatic extinction of the operating license and expiry of the TRC.
The production license expires in the following situations:
- With the expiry of the reserve capacity title for injection into the RESP;
- When the guarantee is not provided;
- With the issuing of a new production license replacing it;
- By renunciation by the holder, exercised by means of a written statement addressed to DGEG;
- In the event of dissolution, cessation of activity or approval of the liquidation in insolvency and company recovery proceeding of the company that holds the license; and
- With the extinction of the title of use of water resources or of the title of use of the maritime space on which it depends, if applicable.
The production license may be revoked when its holder:
- Fails to comply with the duties relating to the exercise of the activity;
- Fails to comply with the determinations imposed by the technical supervision;
- Does not obtain or maintain updated the civil liability insurance;
- Fails to send to DGEG and ERSE, on two consecutive occasions, informative data on the operation and exploitation of the electricity installation;
- Abandons the installations allocated to electricity production or interrupts the licensed activity, for a continuous or interspersed period of six months or more, within a period of one year, for reasons not based on technical reasons or on capacity mechanism or system services;
- Undertakes substantial changes to the electrical installation without having obtained a permit.
2.4. OPERATING LICENSE
Except for the possibility of operation on an experimental basis, the electrical projects subject to production license can only start operating after obtaining the operation license.
The application for the issuance of the operation license is addressed to DGEG and must be accompanied by the following documents: (i) a declaration of conformity of execution, signed by the person responsible for the execution and by the installing entity, certifying that the installation is concluded and ready to operate in accordance with the conditions of the production license, (ii) an opinion from the grid operator that the conditions for connection and injection of energy into the grid have been met, (iii) a favourable opinion from the overall manager of the SEN, (iv) proof of conclusion of the civil liability insurance, and (v) a document proving the availability of the land.
Once the application for an operation license is submitted, DGEG must inspect the electrical installations within 30 days of receipt of the license application. If the application is duly completed, DGEG will make its decision within 10 days of receipt of the inspection report. The request for the issue of the operating license can only be rejected on the grounds of non-compliance of the installations with the legal and regulatory conditions or with the conditions stipulated in the production license.
Once granted, the operation license establishes the conditions under which the electrical installation is to operate and certifies that the project was built in accordance with the requirements and specifications set out in the production license and applicable regulations, as well as that it is fit to supply power to the grid, granting the project the right to start operating.
The operation license must be issued within a maximum period of one year from the date of issue of the production license, except in the following cases:
- TRC allocation in agreement with the operator of the RESP, in which case the operating license may be issued within a maximum period of 90 days after the start-up date of the RESP infrastructures to be built or reinforced;
- Operationalisation of the connection conditions by the operator of the RESP within a period longer than that defined for the issue of the operating license, in which case it may be issued within a maximum period of 90 days after the availability of that infrastructure.
In any case, the periods for issuance of the operation license may be extended under the same terms applicable to the issuance of the production license referred to in paragraph 2.3 above.
Decree-Law 30-A/2022 of 18 April, which established exceptional measures to simplify the procedures for producing energy from renewable energy sources, exempted the issuance of an operation license for electricity generating centres from renewable energy sources, for storage facilities and for production units for self-consumption whenever the grid operator confirms the existence of conditions for connection to the RESP. The operating license is now requested within 3 years after notification by the grid operator, and the DGEG may also waive the need for a previous inspection.
The rules set out in Decree-Law 30-A/2022 are temporary in nature and will remain in force until 19 April 2024.
2.5. PRIOR REGISTRATION AND OPERATING CERTIFICATE
The previous registration for project 1 MW or below capacity is made through an electronic platform as follows.
After the applicant has registered on the platform, the ORD has 20 days to issue an opinion on the existence of technical conditions for connection to the grid and compliance with applicable regulations, respecting the sequential order of requests.
DGEG may refuse prior registration within 30 days of the issuing of a statement by the ORD or after the end of the respective period in which it was issued, in the event of non-compliance with the legal and regulatory requirements for exercising the activity.
After the deadline for refusal, the prior registration is issued (with or without conditions) and the applicant can proceed with the installation.
After installation, the holder of the previous register requests the inspection entity for private service electrical installations to carry out an inspection to check the compliance of the installation with legal and regulatory standards. If the inspection report is not refused within 10 days after submission, the operation certificate is considered awarded and the connection of the installation to the RESP is authorised.
The request for the issuing of the operation certificate must be made within a maximum period of 9 months after the issue of the previous register, except in cases where there is a delay in the network operator's provision of the connection conditions to the RESP. In this case, DGEG will suspend the deadline for the corresponding period. In any case, the time limit can be extended by half.
The previous register can be freely transferred by its titleholder. However, changing ownership before issuing the operating certificate follows the same regime as that established for the transfer of the production license (see 2.3.2 above) and the TRC (see 2.2 above). The prior registration can also cease its effects due to expiration or revocation.
The prior registration expires when:
- Fees due are not paid;
- No request for an operating certificate is presented within nine months after the issue of the prior registration (except in cases where there is a delay in the RESP operator making the connection conditions available to the RESP); and
- The holder renounces the registration.
In turn, prior registration is revoked by DGEG when the activity is carried out in breach of legal and regulatory norms and the holder has not - within the time limit set - adopted the DGEG's recommendations for restoring legality.
2.6. PRIOR NOTICE
The prior notice of small (up to 700W) self-consumption projects is carried out through an electronic platform. After registration of the applicant by filling in a form, the respective proof of submission is automatically issued.
After obtaining the proof, the interested party may proceed immediately with the installation of the equipment.
If the injection of electricity into the RESP is planned, the DGEG requests the ORD to indicate the conditions for connection to the RESP within 30 days of obtaining proof.
The effects of the prior notice cease under the same terms applicable to prior registration.
2.7. OVER-EQUIPMENT AND RE-EQUIPMENT
Over-equipment and re-equipment are allowed with the aim of: (i) maximizing the generation capacity allocated to a reception point at the RESP and (ii) reducing the pressure on the territory resulting from the installation of new power generation plants. These are defined in Electricity System Law as:
- Over-equipment: the alteration of the generating plant through the installation of more generating equipment or inverters with an increase in installed capacity up to a limit of 20% of the connection power assigned to the generating plant in the respective prior control title;
- Retrofitting: the total or partial substitution of equipment, without changing the implantation polygon of the power plant, with a maximum limit of 20% of the connection power at the RESP.
Both overfitting and retrofitting constitute a non-substantial amendment to the pre-existing prior control title. Both may be requested after the issue of the production license or prior registration and before or after the issue of the operating license or operating certificate. Non-substantial alterations depend on prior authorization from DGEG and are annotated to the production license or prior registration.
The request for alteration of the prior control title is submitted to DGEG with the same information that accompanied the application for the granting of the production license or prior registration. Within 5 days of submitting these elements, DGEG may request additional information to be provided within a maximum period of 30 days. Within the same period, DGEG may also consult the entities that have made statements in the prior control process on the issues that are the object of the alteration.
DGEG issues its decision within 15 days from the deadline for responses from the entities consulted.
Except for hydroelectric plants with a connection power of more than 10 MVA, all renewable energy power plants can be over-equipped or retrofitted.
The energy injected into the RESP relative to over-equipment and/or re-equipment is remunerated at market price or through bilateral contracts. However, in relation to retrofitting, if the power plant benefits from a guaranteed remuneration scheme, this scheme is also applicable to the electricity injected into the RESP resulting from the retrofitting.
The over-equipment may be legally separated from the pre-existing generating plant, being registered, in the pre-existing prior control title, in the name of a legal entity distinct from the holder of the generating plant to be over-equipped, but compulsorily controlled by the holder of the generating plant.
To this end, the holder of the plant must submit to DGEG a contract signed with the holder of the new plant resulting from over-equipment defining, namely, (i) production of electricity, (ii) injection of electricity into the RESP, (iii) metering and billing, (iv) ownership of facilities and equipment, and (v) sharing of information.
The holder of the generating plant and the holder of the autonomous over-equipment are jointly liable to the licensing and supervisory entities, grid operators or the overall SEN manager for the fulfilment of legal and regulatory duties and obligations arising from the prior control and inherent to the installation and operation of the over-equipment and its connection to the grid..
The over-equipment installation is not susceptible to autonomous transmission in relation to the pre-existing power plant, even in cases of legally separated over-equipment, except when the transmission is part of group restructuring operations that do not result in a change of the beneficial owner registered in the RCBE.
2.8. HYBRIDS AND HYBRIDIZATION
Hybrid power plants and hybridization regimes aim at mitigating the scarcity of grid capacity and maximizing the reception of energy at the RESP, and are defined in Electricity System Law as follows:
- Hybrid plants: generating plants or UPAC that, in the prior control procedure, present simultaneously more than one production unit using several primary sources of renewable energy;
- Hybridization: the addition to an existing plant of new generation units using different primary renewable energy sources, without changing the injection capacity of the pre-existing generating plant. Hybridization can be carried out at any power plant.
The Electricity System Law allows hybrid production systems to be set up ab initio or, subsequently, through a greatly simplified prior control procedure to amend the production license.
The installation of a hybrid power plant and the hybridization of an existing power plant are subject to the prior control regime applicable to the exercise of the activity of electricity generation referred to in chapter 2.1. However, hybridization, regardless of the installed capacity, is exempt from obtaining TRC, since there is no increase in the injection capacity of the existing electricity generating plant.
For hybridization, a new prior control title will be issued - the subsequent prior control title - which expressly identifies the injection capacity in the RESP allocated to the new production unit. This implies the modification in conformity of the pre-existing TRC, to be promoted by DGEG or, in cases of modality of agreement with the grid operator, by the respective operator. In the prior control procedure, DGEG informs the applicant of the instructional elements already delivered and which remain valid.
As in the case of over-equipment, the new plant resulting from hybridization may be legally separated from the generating plant to be hybridized. However, in hybridization, it is not necessary to have a domain relationship with the owner of the pre-existing generating plant.
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