Ei's assessment: No reduced grid fee for small-scale production plants

Small-scale production facilities must pay a grid fee that reflects the actual costs of feeding in electricity. A reduction in the grid fee for small-scale facilities means in practice that the cost is passed on to other grid customers. It is not compatible with the EU Electricity Market Regulation, which takes precedence.

Key Highlight:

* Power per group falls below the limit of 1,500 kW, which according to the provisions of the Electricity Act could mean a reduced grid charge.

Original Press Release:

March 20 -- Energy Market Inspectorate issued the following news release:

Owners of smaller production facilities must pay a grid fee that reflects the actual costs of feeding in electricity. A reduction in the grid fee for small-scale production facilities means in practice that the cost is passed on to other grid customers. It is not compatible with the EU Electricity Market Regulation, which takes precedence over national regulations.

The Electricity Act (Chapter 4, Section 37) states that owners of a production plant, for example a solar cell plant, which produces less than 1,500 kW must receive a reduced grid fee for feeding electricity into the grid. According to ch. 4 § 38, small installations that meet certain criteria are to be exempted entirely from network charges for the input of electricity.

The provisions of the Act were drawn up and decided during the 1980s. The purpose of the regulations was to protect small-scale electricity producers, mainly hydroelectric producers, who at the time could not sell electricity to anyone other than the local grid company. That problem no longer exists, because a producer can sell his electricity on the market regardless of plant size. However, the provisions have been retained in the Electricity Act and are now, according to the Energy Market Inspectorate's (Ei's) assessment, in conflict with the principles for how network charges must be designed according to the Electricity Market Ordinance, which must be applied from 1 January 2020. The Ordinance instead states in Article 18 that the fees to be charged by network companies must reflect actual costs and be applied in a non-discriminatory manner.

Solar parks make the issue relevant

The issue of reduced network charges according to Chapter 4 of the Electricity Act. Section 37 has now been updated because more and more solar parks are being built. For producers, there can be large sums to save each year by connecting solar cells to smaller groups so that the power per group falls below the limit of 1,500 kW, which according to the provisions of the Electricity Act on reduced grid charges could mean a reduced grid charge.

- According to the electricity market regulation, each producer must bear his own costs. This means that the actor who gives rise to a cost must also pay for it. The costs should not burden other network users, for example in the form of higher electricity grid fees, says Carl Johan Wallnerström, Acting Head of Department at Ei.

The Electricity Market Ordinance is above the Electricity Act

Since the Electricity Market Ordinance and the Electricity Act conflict with each other, there is great uncertainty among many network owners and producers about which rules apply. The electricity grid companies seem to make different judgments as to whether the grid fee should be reduced or not, and Ei receives many questions about this in particular.

- Ei's assessment is that the provisions of the Electricity Act may not be applied in conflict with the Electricity Market Ordinance. Grid owners must therefore no longer reduce the grid fee for small-scale production facilities, says Carl Johan Wallnerström.

Ei has decided on the approach which means that the provisions on reduced network charges may not be applied. Ei will follow how the network companies apply the current rules in the future.

- If disputes arise, a producer or a network company can still turn to Ei for a review of the network fee, says Carl Johan Wallnerström.

Disclaimer: The Above Content is Auto-Translated

Source: Energy Market Inspectorate

[Category: Regulatory and Legal]