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2nd International Conference “Energy and Climate Change” of
PROMITHEAS Network,
8-9 October 2009, Athens, Greece
Premises for Large-Scale
Implementation of
Distributed Generation in
Romania
Camelia Vasile, MSc Eng
Institute for Studies and Power Engineering
Athens, 10/08/2009
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2nd International Conference “Energy and Climate Change” of PROMITHEAS Network
Contents

General framework

Structure and prospects

Targets

Legislation

Promotion Mechanism

Regulatory obstacles and necessary measures

Research priorities
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General framework (1)
DG has, in the long term, the potential to make a large contribution to the EU
energy supply, achieving security of energy supply and environmental
sustainability. Main targets:


Decreasing the cost of electricity and fuel supplies to competitive levels
developing highly efficient concepts and achieving major cost reductions
in the entire production chain
Improving reliability, safety, availability, system efficiency and durability
with long maintenance intervals of electricity supply
Transforming the conventional power transmission and distribution grid into a
sustainable, unified and active energy service network with a large share of DG
requires new concepts and systems for planning, control and supervision.
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General framework (2)

In Romania - DG utilization is making its first steps
- interest of investors in installing WPPs increased considerably
- is expected that investments in DG technologies will grow

Potential for RES - very high

Successful projects are in place, but the investment rate in the renewable sector is
quite low
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Structure and Prospects (1)
Structure of electricity production in 2008
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Structure and Prospects (2)
Hydro energy - the biggest share in the total
participation of RES to the power balance


Hidroelectrica (state-owned company):


275 HPPs and power pumping stations summing
up an installed capacity of 6,374 MW
main output comes from large hydropower plants

Power generation in HPPs in 2008: 17 TWh

Strategy for the period 2003-2025:


in 2025 70% of the hydro potential will be used
(compared to 50% today)
electricity production - 24 TWh for an installed
capacity of 9,000 MW
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Structure and Prospects (3)

Installed capacity in wind turbines - 11 MW
Great number of private investors interested in
installing new wind generation capacities - wind power
the only RES for which there are important planned
projects

Requests for grid connection received by the TSO about 7000 MW

Estimated that only 1000 – 1500 MW will be
integrated into the NPS in a first phase

Connection agreements for an installed capacity of
900 MW

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Structure and Prospects (4)
A certain increase in solar electric
utilization In the last years


High investment costs
Not expected to have a significant
contribution in the power balance

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Targets for RES (Energy Strategy of Romania)
RES targets (electricity produced from RES in the gross
domestic electricity consumption)
38%
38%
37%
36%
35%
35%
34%
33%
33%
32%
31%
30%
2010
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2015
2020
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Existing Legislation

Law 220/2008 establishing the promotion system for RES electricity generation

GD 750/2008 approving state subsidies for RES utilization

GD 90/2008 - Regulation regarding the interconnection of generators to the power
grids of national interest

Energy Law no 13/2007 - transposes articles from the EU Directive 2003/54/CE
concerning common rules for the internal market in electricity

GD 1535/2004 approving the National Strategy for Renewable Energy Sources
Utilization

GD 443/2003 regarding the promotion of electricity production from renewable
energy sources – transposes the EU RES-e Directive 2001/77/EC provisions
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RES Promotion Mechanism (1)
Green certificates and mandatory quota system
Mandatory quotas for the suppliers settled until 2020:
 8.3% for the period 2010 – 2012
 16.8% for 2020
GCs price:
 Min 27 Euro/certificate
 Max 55 Euro/certificate
Penalty system
Penalties for non fulfilment of the quota:

70 Euro/certificate for the non-purchased certificates
Collected penalties are used annually for investments in the national grid
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RES Promotion Mechanism (2)
The electricity producers receive from the TSO

a) 1 GC
for each MWh of electricity produced in new HPPs or refurbished HPPs
with an installed power up to 10 MW and delivered into the grid

for each 2 MWh of electricity produced in HPPs with an installed power
between 1 and 10 MW, other than those mentioned above, and delivered
into the grid

b) 2 GCs
for each MWh of electricity produced in HPPs with an installed power up
to 1 MW and delivered into the grid

up to 2015 and 1 GC starting with 2016 for each MWh produced in WPPs
and delivered into the grid
c) 3 GCs

for each MWh produced from biomass, biogas, bioliquids, etc. and
delivered into the grid
d) 4 GCs

for each MWh produced from solar energy and delivered into the grid
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Regulatory obstacles to the deployment of DG and necessary
measures (1)
Responsible for RES energy promotion - a number of institutions and state

administrative authorities (Ministry of Economy, local authorities, ANRE, ARCE) not
appointed by law to execute economic activities (e.g. execution of pilot projects in the
RES field, implementation of new execution projects for new capacities, etc.) and not
having a specific apparatus for developing such activities

Established responsibilities and competencies in the field of RES are not clear

Management of such activities can only be achieved by dedicated structures
Measures
Obstacles

Non-existence of a competent

Creation of a management body within
authority responsible for the
the Ministry of Economy and Finances
implementation of the strategy
dedicated to the activity of RES energy
for RES utilization
promotion and achievement of RES
strategy goals
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Regulatory obstacles to the deployment of DG and necessary
measures (2)
GD 219/2007 transposes the provisions of EU directive 2004/8/EC concerning the

promotion of cogeneration based on a useful heat demand
No steps made towards the elaboration of secondary legislation necessary for:


adoption of the harmonized reference values and of applicable correction factors;

approval of bonus-type support scheme applied to the cogeneration electricity production;

analysis for the national cogeneration potential of Romania
Exception: procedure for issuing the guarantees of origin for the electricity produced in

cogeneration of high-efficiency
Obstacles

Lack of secondary legislation for
the promotion of CHP
Measures

Elaboration of secondary legislation for
the promotion of cogeneration of highefficiency
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Regulatory obstacles to the deployment of DG and necessary
measures (3)

Grid operators - priority connection of all RES or cogeneration units
investments for
integration of such generators

Costs that affect the grid operators are related to:

grid strengthening and development

back-up capacities from other power plants that have to be kept in reserve for cases of total generation
outages of DG, such as WPP, as well as for balancing variations in wind energy injections


development of new activities.
These costs submitted to the regulator for approval and then reflected into the price of the
consumers
Measures
Obstacles

Regulatory uncertainties of cost

Development of a mechanism for
recovery of distribution and
determining a fair cost allocation for
transmission companies for RES
DG integration
integration into the grids
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Regulatory obstacles to the deployment of DG and necessary
measures (4)
Project developers need to obtain an entire package of permits and approvals from a

series of state and municipal authorities, depending on the project specifics
The process of obtaining all approvals is very heavy (could take up to two years) -

delays for the investment project.
Obstacles


Time consuming administrative
Measures

Establishing procedures for DG project
procedures for development
proposals and diminishing the
projects
response times
Lack of informational support for
potential DG investors

Improvement of the “Guide for RES
electricity producer” with information
related to the authorization procedure
for a RES generation capacity
construction
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Research priorities (1)
A. Assessment of the potential

Old potential for RES and its values calculated at country level

No updating of the RES potential maps

No CHP potential studies

Lack of knowledge about the protected areas on which constructions are not
allowed - problems in obtaining the environmental permit

No centralized database regarding the areas with RES potential or a portfolio of
RES projects to help the investors in selecting their investment location
Measures

Inventory of renewable energy sources by sources and regions
and exclusion of protected areas from the RES potential maps

CHP potential study
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Research priorities (2)
B. Technical priorities

The solution studies emphasized a series of problems related to two important issues:

the connection possibilities

how the NPS grid should react when it has to deal with a power source with random
and intermittent operation mode

Problems signaled in relation to the grid connection:

limited possibilities of the existent networks (distribution
as well as transport) to evacuate the power produced
by the wind farms;

the effects of wind farms connection to the grids,
especially regarding the voltage level and the power
quality
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Research priorities (3)
Research on Impact of DG on the Design and Operation of the Grid
The solution studies highlighted the following:

At MV level (20 kV)

connecting WPP of maximum 10 MW - due to reduced capacity of the evacuation line or due to risk of
exceeding the short circuit capacity of the interconnection substations


difficulties in maintaining the flicker effect in the limits set by the technical norms

problems in keeping the voltage in its admissible limits
At HV level (110 kV)

need of tele-transmission means (e.g. optical fiber) - additional expenses for the connection options of a WPP
directly to an existing line


the HV grid needs to be developed - research for its transformation from a passive network into an active one
At transport network level (220 kV, 400 kV)

The Romanian NPS does not have enough quick start tertiary reserves required for wind operating systems

Technical connection permits issued for 2650 MW

Quick start tertiary reserves are available for only 800 MW (analyses of the National Dispatch Center - DEN)
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Research priorities (4)
Research on grid elements

Contemporary power electronic interface

Use of last generation of power electronics and invertors available in countries with better experience
in DG for improving the reliability and flexibility of the distribution system

Romanian research community needs to focus on the improvement in manufacturing, design and
technology


researches in converter topologies and control

the use of new materials for semiconductors and magnetic components
ICT for network management

Limited possibilities for financing innovations in the network - ICT implementation should be carried
out gradually, after a preliminary plan taking into account the priority of urgent needs, expenses and
time needed for their introduction
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Research priorities (5)
System research
Assessment and improving the grid possibilities to integrate DG

Studies regarding the impact of WPPs on the NPS emphasized that the use of dimensioning
criteria applicable in the case of classical power plants is not conclusive. For instance, the
connection solution analysis cannot be done only at peak load - DGs like WPPs cannot be
planned so that they cannot be correctly considered in covering the load curve

Distribution and transport grids require strengthening investments for wide penetration of DG

Another problem - the calculation of the transitory stability

Wind forecast - no proper solution for this issue – e.g. a cooperation between the TSO, the
National Agency for Meteorology and wind dispatch operators
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Research priorities (6)
System research
Active Design Concept for the Grid Structure

Requests for the installation of over 12,000 MW in WPPs up to 2012 - unknown if
all this power could be installed

Difficulties for the grid operators in planning the development of the distribution
and transport grids
Is important that grid operators develop active network management
for integrating DG into the grid
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Research priorities (7)
System research
Demand Side Management
DSM programs - planning, implementing, and monitoring activities of electric utilities,

designed to encourage consumers to modify their level and pattern of electricity usage
The various opportunities for including the consumers into the grid operation are not used in

the Romanian electric system and need to be properly researched
Micro-grids

The micro-grid concept allows for local control of distributed generation thereby reducing or
eliminating the need for central dispatch.

A high level of interest and research on the utilization of micro-grids concept at EU level

Research is also needed to be done in Romania towards its implementation
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Research priorities (8)
Research on Electricity Storages

DG technologies are intermittent, requiring demand flexibility, backup power
sources, and very likely enough electricity storage for days to perhaps a week

Strategically-placed storage systems can increase the utilization of existing T&D
equipment and defer/eliminate the need for costly T&D additions

In Romania the most common storage technology is pumped hydro storage
Research on DG Technologies

Equipment manufacturing is done on a very small-scale and for the new DG
investments imported equipment and systems are preferred
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Research priorities (9)
C. DG Economics
The economics of DG depend on complex mix of economic factors

On one hand - economic advantages over power from the grid:

On-site production avoids T&D costs

Production can be limited to parts of the day when grid electricity is expensive, with grid power
purchased at less costly periods


DG can be available in the case of a power system outage to assure a more reliable supply

DG may also be better positioned to use inexpensive fuels (ex. local biomass)
On the other hand - higher unit capital costs/kW due to high combined capital,
operation, and maintenance costs of DG systems

Understanding of the fundamental economics of DG is essential for policymakers
to arrive at sound decisions regarding the future of DG
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Research priorities (10)
D. Pricing & Cost allocation

An analysis should be done towards finding whether the feed-in-tariff would be a
better support scheme for RES investments encouraging

Research on the development of a mechanism for proper allocation of costs to
distribution and transmission companies for DG integration to the grids is needed
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Priorities timing
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Conclusions

In Romania DG utilization is in its very beginning but it is expected that the
investments in DG technology applications will grow

In order to integrate DG to the Romanian power system there is need for
sustained research and measures to overcome the obstacles of regulatory,
economic and technical nature

With the recent “rush” for wind power in Romania additional measures are
needed in order to ensure the security and stability of the NPS in accordance
with the UCTE methodology on system adequacy
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THANK YOU FOR YOUR ATTENTION
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Contact
CAMELIA VASILE, MSc Eng.
Institute for Studies and Power Engineering (ISPE)
Energy and Environment Division
1-3 Lacul Tei Blvd.
020371 Bucureşti
Romania
ph. + 40 21 2061331
fax. + 40 21 2101255
email: [email protected]
www.ispe.ro
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