The Ministry of Mining and Energy has drawn up the long-awaited changes to the Law on the Use of Renewable Energy Sources, which will change the rules for balancing, priority grid access, and grid connection for green energy power plants. The proposed changes have been eagerly anticipated by investors, both those who seek to receive state subsidies in renewables auctions and those who intend to develop market-based, zero-subsidy projects.
Public consultations on the Draft law on changes and amendments to the Law on the Use of Renewable Energy Sources kicked off on Saturday and will close on February 9.
The Ministry of Mining and Energy has said the purpose of the proposed changes is to create optimal conditions for renewable energy auctions, as well as to ensure the stability of the electricity system amid a mass integration of renewables, such as solar power plants or wind farms.
A total of 17,000 MW of solar and wind capacities have applied for grid connection to date, which is more than double the current total installed capacity in Serbia, of 8,000 MW, the ministry recalled.
Balancing responsibility to apply to subsidized renewables only
Among the key changes is that state power utility Elektroprivreda Srbije (EPS) will assume balancing responsibility only for power plants that receive state subsidies – market premiums or feed-in tariff. The current law requires EPS to balance all power plants.
Also, renewable energy producers who receive premiums will have to pay a fee to EPS as a fixed percentage of the price offered at an auction per MWh, as well as compensate for the positive difference between the amount of electricity sold and the amount generated, at the current price on the day-ahead market.
They will also be obliged to forecast their electricity output responsibly.
The ministry believes this will create the conditions to conduct the planned auctions, encourage investment in new power plants, and shield EPS and end-consumers against excessive costs of renewables integration.
Right to priority off-take to be reserved for small power plants
The draft also limits the right to priority off-take of electricity by power grid operator Elektromreža Srbije (EMS) and EPS for all renewable energy producers, including prosumers.
The right to priority off-take of electricity, according to the draft, will be reserved only for small facilities, of up to 400 kW, and from January 1, 2026 only for those of up to 200 kW.
Given the pending requests for grid connection for 17 GW of power plants, the ministry believes that the current rules could jeopardize the work of the power gird and that prosumers should be limited to the level of distribution.
The ceiling of 400 kW, or 200 kW, for all green energy producers is in line with European regulations which Serbia should transpose, according to the ministry.
EMS can ask investors to ensure batteries as a requirement for grid connection
If EMS deems that connecting a new power plant using intermittent renewables may threaten the stability of the system, it can ask the investor, as a requirement for grid connection, to ensure an additional capacity in Serbia capable of providing frequency regulation and other system services.
Such capacities can be conventional sources, but also energy storage capacities, or dispatchable energy sources, according to the draft.
The ministry believes this will ensure a mechanism to protect the stability of the system in case of a mass integration of intermittent renewable energy sources.