The Environment and Energy Ministry’s overall plan for the renewable energy sources (RES) sector includes a comprehensive revamp of the RES special account that will include revisions to its revenue-raising mechanisms.
As has been previously reported by energypress, the need to maintain a balanced RES special account is a requirement that is being constantly demanded by the country’s quartet of lenders, otherwise the RES-supporting ETMEAR surcharge added to electricity bills must be increased.
LAGIE, the Electricity Market Operator, which manages the RES special account, has forecast that the RES special account deficit will reach 203.07 million euros at the end of 2016.
Considering the forecast, RAE, the Regulatory Authority for Energy, will need to soon set new increased ETMEAR rates. This revision would need to be made in June. The ETMEAR surcharge is the only exisiting tool that is available to finance RES special account deficits. When LAGIE forecasts deficit figures, RAE ought to respond by increasing the surcharge. However, at this moment in time, the government, fearing political cost, has ruled out such a prospect.
Instead, the ministry appears to have decided to make fundamental changes to the way the RES special account system operates. The ETMEAR surcharge, or contribution from consumers, will cease being the primary tool used to cover deficits. According to energypress sources, a fixed rate will be set and increased only if new RES facilities are installed to increase total capacity and RES special account needs.
Besides intended tariff cuts for over-performing photovoltaic units, as was dislosed by energypress, electricity suppliers will also contribute to keeping the RES special account balanced. The considerable drop in the System Marginal Price (SMP), largely attributed to the entry of RES units to the grid, has increased RES special account needs. Based on the current model, the SMP drop increases the revenues expected to be raised through the ETMEAR surcharge. At the same time, the SMP decline has greatly increased the profit margin of electricty suppliers, as it represents the wholesale price level at which they purchase electricity.
As a result, the government appears to be heading towards sparing consumers of an ETMEAR increase and focusing on collecting the needed RES special account revenues from electricity suppliers. The mechanism’s details are currently being worked on.