• Home
  • News & Insights
  • Joint study of the Romanian Competition Council and Romanian Energy Regulatory Authority identifies grid connection barriers and issues recommendations

Joint study of the Romanian Competition Council and Romanian Energy Regulatory Authority identifies grid connection barriers and issues recommendations

October 2023 – The Romanian Competition Council (RCC) continues to focus on the energy markets, not only through investigations and merger control analysis, but also by carefully reviewing the markets through sector inquiries and studies. Given Romania’s declared interest in considerably bolstering its renewable energy capacities in the short term—which is also supported by EU funds and the Contracts for Difference (CfD) support scheme in the pipeline, renewables have recently been high on the RCC’s agenda.

Roughly two months after publishing its preliminary conclusions following its study on permitting bottlenecks in the renewables sector (see our previous article here), the RCC has now teamed up with the Romanian Energy Regulatory Authority (ANRE) in a joint effort to assess grid access and barriers thereto. This point, in particular, has been one of the thorniest aspects for developing new power-generation capacities in Romania.

Some of the main points and recommendations highlighted by the preliminary report published yesterday include:

  • Barriers to grid access include the lack of disincentives against speculative investments. The study identifies the market practice of developers getting projects to the “ready to build” stage only to sell them to other developers. This is considered speculative, as it could lead to blocking other, more credible investments, as new grid connection permits (ATRs) are very difficult to obtain while previously issued ATRs are still valid (and many “speculative” projects eventually end up abandoned). Suggested deterrents against speculators include setting up execution guarantees or sanctioning developers’ passivity over extended periods.
  • The grid connection process is lengthy because of the legislation, which is unclear or uncorrelated in some respects. Grid connection regulations should be further clarified, and the authorities suggest implementing a “one-stop-shop” contact point to obtain a single license for renewable energy production, staffed with representatives from the public administration and the network operators.
  • Financing-related barriers are mostly related to prohibitive grid reinforcement costs (with tariffs of about EUR 100,000/MW).
  • Romania’s power transmission and distribution networks are underdeveloped, and previously approved development plans had difficulties being implemented (due generally by the amount of time necessary to “tick all the boxes” relating to public procurement, works execution, government decisions and environmental permitting, missing cadastral plans etc.). The report recommends putting together a strategy on dealing with congestions and placing new generation capacities, to be considered by the Ministry of Energy and other relevant authorities.
  • A suggestion to allocate grid connection capacities based on competitive procedures, to be carried out periodically, depending on grid development.
  • There is a need of further qualification for the various experts and personnel involved in the process, both among the distribution operators as well as the developers’ consultants.

A full Romanian-language copy of the joint RCC-ANRE report is available here. The authorities await comments from interested parties by 4 November 2023.

Catalin Graure Managing Associate
+40 21 307 1640
    • SHARE