Amendment of the Act on Support of Renewable Sources of Energy and Highly Efficient Combined Production

Support of production of electricity from solar energy

Effective as of July 1, 2013 provision of support for the producers of electricity from solar energy in form of assumption of liability for an error of the regional distribution network operator, shall be limited. Pursuant to the new legislation such support shall be provided only to electricity producers for facilities with the installed power of up to 30 kW, as opposed to previous 100 kW.

The support for the producers of electricity from solar energy in form of surcharge shall change in a similar manner as in the case of support in form of assumption of liability for an error. Under the amended SRS Act the support in form of surcharge shall apply only to facilities of producers of electricity from solar energy with the installed power of up to 30 kW, which facilities have to be placed on the roof construction or walls of a single building firmly affixed to the ground and registered with the Cadastre of Immovables. The previous legislation, on the other hand, stipulated surcharges for all such facilities with installed power of up to 100 kW.

A new duty of producers of electricity from solar energy will have become effective as of March 1, 2013, as as of this date such producers will be obliged to label each single photovoltaic panel of their facility with information about its individual power. Also, under the amended Section 2(3)(d) of the SRS Act the aggregate installed power of facility shall be calculated as a sum of all the individual powers of all photovoltaic panels of the facility.

Reconstruction or modernization of facility as a condition for provision of support

Both the previous legislation and the amended SRS Act provide for support for electricity producers for the period of 15 years as of commencement of operation of the facility or as of the year of reconstruction or modernization of the technological part of the facility. Effective as of March 1, 2013 the new SRS Act, however, does not strictly require that the costs for reconstruction or modernization of the facility´s technological part be over 50% of the investment costs for procurement of new comparable technological part of the facility, as was required under the previous legislation.

Under the new legislation if the costs for reconstruction or modernization of technological part of the facility are lower than 50% of the investment costs for procurement of new comparable technological part of the facility, than the amount of actual support in form of surcharges shall be decreased depending on the amount of the actual investment in the manner as follows:

1. in the extent of less than 50% up to 40% including the surcharges shall be decreased in 20%;
2. in the extent of less than 40% up to 30% including the surcharges shall be decreased in 40%;
3. in the extent of less than 30% up to 20% including the surcharges shall be decreased in 60%;
4. in the extent of less than 20% up to 10% including the surcharges shall be decreased in 80%,
5. in the extent of less than 10% the surcharges shall be decreased in 100%, i.e. no surcharges shall be provided.

The amendment of the SRS Act also specifies the term reconstruction and modernization of technological part of the facility, whereas reconstruction and modernization has to secure technological appreciation of the facility consisting in particular in proven increase of efficiency, increase of the installed power, decrease of its own use of energy or decrease of losses and costs for electricity production, all of which the producer has to evidence on the basis of an expert´s opinion. Given the above, a new obligation of the electricity producer has been added in order to acquire support for reconstruction and modernization of the facility, i.e. to have an expert´s opinion elaborated, which opinion shall evidence increase of the installed power, decrease of its own use of energy or decrease of losses and costs for electricity production.

The rule that the support in form of take off of electricity for the electricity price for losses and in form of assumption of liability for error granted to the facilities with the aggregate installed power of up to 1 MW shall be provided for the whole life-cycle of such facility, still remains in effect.

Cessation of the right to electricity production support

Pursuant to new Section 3b of the SRS Act the right to support of production of electricity from renewable sources of energy shall not apply to electricity producers´ facilities or biomethane producers´ facilities which:

1. were constructed without certificate for energy facility construction, if required, or
2. were constructed or introduced into operation in contrary to the SRS Act or other applicable legislation.

The amended SRS Act also introduces cessation of the right to support of production of electricity from renewable sources of energy in the event that within the 15 years period of support the electricity producer was fined twice pursuant to the SRS Act for commitment of administrative tort under letter a) to c) below, effective as of effectiveness of the second resolution on levying fine:

1. for increase of the aggregate installed power of the facility in contrary to the SRS Act or other applicable legislation in more than 5 %, or
2. for changed scheme of connection of the facility in contrary to the SRS Act or other applicable legislation which change is the cause of an inappropriate use of produced electricity or inappropriate use of heat, or
3. for discovered excessive amount of electricity for which support in form of surcharges is provided, and which is not proportional to the used facility and is achieved by additional facilities.

With regards to the abovementioned it should be duly noted that in order for the right to support of production of electricity from renewable sources of energy to cease to exist no special resolution of the Regulatory Office of Network Industries or Ministry of the Economy of theSlovakRepublicis required. The right to support ceases to exist by operation of law (automatically) as of effectiveness of the second resolution of the State Energy Inspection on fine for one of the administrative torts listed under letter a) to c) above. For the sake of completeness, it is also worth mentioning that the above administrative torts (a) to c)) are newly introduced into the SRS Act and complete the list of administrative torts under Section 16 of the SRS Act.

Change, cancellation and correction of the certificate of the origin of electricity

It is also worth briefly mentioning that the amendment has incorporated a new Section 12b into the SRS Act under which the Regulatory Office of Network Industries shall, on the basis of petition of electricity or biomethane producer or without it, change or cancel the certificate of the origin of electricity from renewable sources of energy, certificate of the origin of electricity produced from highly efficient combined production or certificate of the origin of biomethane, in the event that it has been proven that such certificate has been issued on basis of incorrect or false data. If the respective administrative proceedings is initiated without petition the Regulatory Office of Network Industries shall allow the electricity producer of biomethane producer to submit their opinion towards the reasons of the change or cancellation of the respective certificate.

The electricity producer or biomethane producer is entitled to file objections against the resolution of the Regulatory Office of Network Industries on change or cancellation of the certificate of the origin of electricity from renewable sources of energy, certificate of the origin of electricity produced from highly efficient combined production or certificate of the origin of biomethane, within 15 days as of delivery of the notice on change or cancellation to the chairman of the Regulatory Office of Network Industries.