The adoption of the Law on the Use of Renewable Energy Sources in 2021 created a very favorable environment for investments in green energy. Recognizing the opportunities and incentives, investors in a short period of time submitted a large number of requests to Elektromreža Srbije as a transmission system operator ("TSO") for the connection of future power plants using renewable energy sources. More precisely, requests for the connection of 22,000 MW have been submitted so far, while the total capacity of the power plants connected to the system is about 8,500 MW.
Having in mind that on the one hand the new 5,800 MW can be connected to the energy system without jeopardizing the security and stability of the system, while on the other hand, there is great interest in investing in this sector, the Government of the Republic of Serbia adopted at the session held on 28 September 2023 new Regulation on the conditions of delivery and supply of electricity („Official gazette of the RS“ no. 84/23) ("Regulation"), which prescribes the procedure for connection to the system in more detail, and certain novelties were introduced as follows.
Connection to the transmission system
As before, the connection procedure is initiated by the request for connection. However, the Regulation now prescribes the preparation of a connection study as a mandatory element. Even before, the connection study was a mandatory element prescribed in the TSO network code and connection procedure. With the adoption of the Regulation, this step gained more importance.
Namely, a person interested in connection to the transmission system first submits to the TSO a request for the execution of the agreement on the preparation of a connection study. This request is submitted no later than the 1st of the month preceding the first month of the interval in which the connection study will be prepared. The Regulation defines that TSO prepares the connection study in two intervals - from 01 March to 30 June and from 01 September to 31 December, which means that requests for the execution of the agreement must be submitted by 01 February, i.e., by 01 August. However, the Regulation stipulates that the initial interval for preparing the connection study begins on 20 December 2023 and that the first requests for the execution of the agreement can be submitted no later than 01 December 2023.
Along with the request for the execution of the agreement, it is necessary to submit proof of the deposit of funds for the costs of preparing the connection study. For the connection of the consumer facility, storage or facility for the production of electrical energy with a power of up to 50 MW, an amount of EUR 50,000 must be deposited. If the electricity producer wants to connect a production facility with a higher power, then the deposited funds are increased for the following facilities:
- over 50 MW and up to 100 MW, EUR 400 per MW is deposited;
- over 100 MW and up to 250 MW, EUR 300 per MW is deposited; and
- over 250 MW, 200 EUR per MW is deposited.
TSO prepares the connection study only after the execution of the agreement, and in the above time intervals. The connection study consists of two parts: the system part and the technical conditions for connection.
Upon receipt of the connection study, the applicant has a deadline of 60 days to submit to the TSO a bank guarantee, guaranteeing that it will:
- execute the connection agreement within 60 days from the delivery of the bank guarantee to TSO;
- obtain approval for connection within 3 years from the date of execution of the connection agreement;
- build the facility within the validity period of the connection approval;
- extend the bank guarantee in a timely manner, if applicable.
A bank guarantee must be provided in the amount of EUR 25,000 per requested MW.
If it is necessary to build the missing infrastructure for the connection, it is possible to execute the agreement on the construction of the missing infrastructure at the same time as the connection agreement with the TSO, and the investor may build the necessary infrastructure at his own expense and on behalf of the TSO.
After taking the above steps and obtaining a construction (and energy) permit, a request for connection to the transmission system is submitted.
Connection to the distribution system
The Regulation envisages the obligation to prepare a connection study for storage and facility for the production of electric energy, which means that end consumers are exempt from this obligation.
The connection study is prepared after the agreement on the preparation of the connection study has been executed. The applicant for the execution of the agreement is obliged to provide the distribution system operator ("DSO") with proof of the deposit of funds for the costs of the study in the amount determined by the DSO, which for electricity producer facilities cannot be greater than:
- EUR 2,000 for objects whose required power is greater than 10.8 kW and less than or equal to 160 kW;
- EUR 3,000 for facilities whose required power is greater than 160 kW and less than 1 MW;
- EUR 5,000 for facilities whose required
power is equal to or greater than 1 MW.
The connection study ceases to be valid if the applicant does not receive connection approval within 2 years from the preparation of the study or in case of the expiration of the construction permit based on which he received connection approval.
By Marko Mrdja, Senior Associate, JPM Jankovic Popovic Mitic
