Law on Amendments to the Law on the Use of RES Adopted

Namely, the adopted amendments to the Law are tackling the issue of inundation with connection applications for new solar and wind power plants, for which the capacity required for connection has been increased from 4.8 GW to 20 GW in the last two years, which is two and a half times higher than the total capacity of all power plants in Serbia.

Such capacity exceeds the power system balancing capabilities and that is a cause for concern for the system operator (Elektromreza Srbije) regarding the operation of the power system. Therefore, the problem has been resolved by amending the Law, so that the system operator will be able to delay the connection of power plants to the system in case that, in the course of a transparent process of preparing the transmission system development plan, it turns out that balancing reserves are insufficient. However, at the same time, investors are given the opportunity to avoid delaying the connection if they, either individually or through another market participant, will provide for additional capacity for balancing.

These amendments protect the guaranteed supplier (EPS) from the financial risk of having to assume the balancing responsibility for all producers of renewable energy. According to the Law, this guaranteed supplier’s obligation is retained only in regards to the privileged producers who have joined the incentive scheme but only for a limited period of time, whereas commercial projects will solve the issue of balancing responsibility on a commercial basis.

The market premium system has been further improved in the interest of citizens, as it will enable the investors to compete with each other, at auctions, in terms of who will offer the highest generation capacity in order to meet the demands of guaranteed supply for the citizens and/or direct contracts to end customers, which will enable green energy to remain and to be consumed in Serbia, instead of being exported.

Special novelties are related to the capacities provided by prosumers, whereas limits are defined for households and for other end-customers in a way that will reconcile the interests of securing the stability of the power system and the interests of prosumers.

Households will be able to install solar panels up to 10.8 kW, and other customers up to 150 kW, while retaining the priority access to the system, without assuming the balancing responsibility. In this way, the concept of prosumers is oriented towards households and small businesses. Large scale industries will be implementing their rights to self-reliant supply through the concept of an active customer following the amending of the Energy Law. The transition period has been also taken into account, therefore industrial facilities up to 5 MW will be able to install solar panels until July 1, 2024, according to the old regulations. On the other hand, the new regulations should contribute to the optimization of household investments in accordance with actual annual consumption and encourage prosumers to avoid using electricity for heating purposes at times when it is most expensive.

By adopting amendments we have managed to achieve the much needed balance between the interest to generate more renewable energy and the interest to have a safe system operation and security of supply, which is important in order to achieve greater energy independence of Serbia and long-term security of energy supply to citizens and the economy at sustainable prices.