Bulgaria

February 2012 update

A draft amendment to the RES Act was introduced in December 2011, just 6 months after the last amendment of the RES act (in May 2011). According to the ruling party GERB the proposals are motivated by the large number of RES projects that have been submitted and approved up to 2011 and the possible challenges for the electricity grid due to increased installation of PV projects.

Most important proposals for changes in the RES Act:

  • Remains the annual determination of `maximum yearly grid connection capacity’ for RES projects that are based on assumptions by EDC/TSO. The State Commission for Energy and Water Regulation (Regulator) has to approve (or disapprove) the proposed `maximum yearly free capacity’ by DSO/TSO. After the approved ‘maximum yearly capacity’ limit for RES is reached, the remaining PV/RES projects requesting grid interconnection are not eligible to interconnect to the electricity grid, at least until the following year. Such procedure contradicts to Directives 2009/28/EO and 2009/72/EO because of no priority of grid access for PV/RES projects (there is no such discriminative legal procedure for conventional power plants).
  • TSO/DSO will prepare schedules for grid connection of all RES projects (excluding biomass) with preliminary grid connection contracts (PGCC), according to the 10-years Plan for Development of the Grid (2010-2020) and the order of precedence of PGCCs.
  • In cases of agreement with the schedule the future producers will have to sign an annex to the PGCC with new terms for grid connection included. Otherwise they will have the opportunity to release the reserved capacity and to receive the paid advance guarantees for grid connection back.
  • The legal-administrative procedure for securing the FiT will be amended and thus valid as of the date of commissioning of a RES/PV system; FiT for PV systems remains fixed for 20 years.
  • When the plant is to be put into operation in different phases over a longer period of time, the electricity produced by each part will be measured separately and will be purchased according to the pertinent price as of the date of commissioning of the different phases/parts;

In addition to the temporally restriction for the development of new RES projects until July 2012, the proposed amendment could affect more negatively on the sector by implementing a delayed time for grid connection of RES plants, although already regulated contractual terms between producers and TGO/DGOs.

The draft amendment to the RES Act was adopted on first reading by the National Assembly and now is under discussions by MPs before second reading and official adoption, which is expected by end of March 2012.

BPVA submitted its official position on the draft with proposals to the National Assembly to consider and approve more clear and predictable terms and conditions for the future producers, including implementation of special new procedure for reduction of the administrative barriers for small-scale PV installations (up to 30 kWp on residential buildings and up to 200 kWp in industrial areas). The members of relevant Parliamentary Commission expressed a positive will for such move and they are discussing several ways to implement it, including different categorization of the installations and grid connection facilities by the Spatial Planning Act, reduction of the administrative steps and of the waiting time for building permits, grid connection contracts, etc. The concept for PV installations of such scale is shortening of the legalization and building to around 3 months. 

October 2011 update

A new RES Act (RESA) was adopted by the National Assembly of Bulgaria and enforced on May 3rd, 2011. Some of the legal procedures for rooftop PV were simplified and shorten, but almost all of the old barriers are still in place. A major new barrier has been created by RESA with regards to grid connection of new projects. First, a maximum yearly grid capacity was introduced, that would mean that only certain projects shall be able to qualify for grid access. Second, the grid connection provisions in RESA are explicitly coming in force as of 01.07.2012 and no transitional legal-administrative procedure is in place until then. That would mean no new PV projects have access to the electricity grid, as there is no procedure in place to provide for that. One further major new barrier was introduced by the amended Act for Protection of Agricultural Lands Act (PALA) where a ban for the use of certain agricultural lands for PV was introduced. The affected territories amount to approximately 40% of the total agricultural land stock.

Most important changes in both acts:

RESA provides for an annual determination of `maximum yearly grid connection capacity’ for RES projects that are based on assumptions by EDC/TSO. The State Commission for Energy and Water Regulation (Regulator) has to approve (or disapprove) the proposed `maximum yearly free capacity’ by DSO/TSO. After the approved ‘maximum yearly capacity’ limit for RES is reached, the remaining PV/RES projects requesting grid interconnection are not eligible to interconnect to the electricity grid, at least until the following year. The maximum-yearly-connection-capacity procedure is not valid for rooftop systems up to 30 kWp in urbanized areas; and for rooftop systems up to 200 kWp in industrial areas.

Applications for grid connection shall be submitted by the future producer to the relevant grid operator together with advance payment in the amount of 5.000 BGN per MWp (appr. 2.600 Euro) for the future plant. Applications for grid connection will be processed by the relevant grid operator in order of entrance and the applicants will receive an answer for admissibility.

Upon signing a Preliminary Grid Connection Contract (PGCC) an advance payment shall be paid to DSO/TSO in amount of 50,000 BGN per MWp (appr. 26.000 Euro) for systems over 5 MWp or 25,000 BGN per MWp (appr. 13.000 Euro) for systems up to 5 MWp. The advance payment is part of the fee for interconnection, incl. rehabilitation and extension of grid connection facilities. PGCC are valid for 1 year, before end of which the applicants have to submit an application for a Final grid connection contract (FGCC). FGCC have validity period not longer than the period for commissioning of the installation and construction of grid connection facilities. These facilities are constructed solely by the operators.

Preliminary statements on technical availability for grid connection admissibility of new RES plants will be issued by the operators as of June 30th on a yearly basis, starting in 2012. At that date the Regulator (State commission for energy and water regulation – SCEWR) shall determine the maximum capacities by regions for the first time.

RESA practically creates a temporary restriction for the development of new RES projects. According to the temporary and final provisions of RESA, the pertinent procedure regarding grid connection of RES power systems is suspended until 01.07.2012. This provision is not valid for RES projects that decide not to receive financial support and they are able to connect to the grid even though that would not be possible for all other new projects.

Legal text of RESA (in Bulgarian): http://dv.parliament.bg/DVWeb/showMaterialDV.jsp?idMat=48899

An amendment to the Act for Protection of Agricultural Lands (APAL) enforced on 04.05.2011 has introduced a discriminatory regime for RES, prohibiting the use of converted agricultural land for construction of photovoltaic (PV) power plants only. All other businesses and enterprises in Bulgaria are not affected by this ban.

Legal text of PALA (in Bulgarian): http://dv.parliament.bg/DVWeb/showMaterialDV.jsp?idMat=50213

There are still several subordinate Acts to be adopted by the national authorities according to RESA and PALA. They have to clarify – or indeed, to introduce - many of the legal-administrative procedures regarding legalization, building and grid connection of PV. Many of the described provisions are clearly discriminative for PV/RES technology and they fail to transpose the European Directives 2009/28 and 2009/72. The new legal framework for RES in Bulgaria contradicts with the EU support policies for RES.

Status as of April 2010

A draft law containing proposals for reducing legal-administrative waiting times and for clarifying and simplifying the connection of PV installations to the grid is currently being discussed by the Bulgarian government. The Bulgarian PV Association is actively involved in the process and first PV LEGAL findings were presented to the government in several high level meetings. The new law is scheduled to come into force between September and December 2010.