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Cogen Europe Briefing paper on priority of access and priority of dispatch

Cogen Europe
Briefing paper on priority of access and priority of dispatch
Article 12 of COM (2011) 370
DRAFT
For the CHP sector, the priority of access and priority of dispatch provision contained in par. 5 of Article 12 “Energy transmission and distribution” of the draft EED aim at reinstalling the links broken since the repeal of legislations and notably the one in place before the Renewable Energy Directive 2009/28
Background:
For the CHP sector, the current Directive 2004/8 has laid down the foundation for positive developments in a number of countries with regard to priority of access and priority of dispatch.
From a legal point of view, legislators decided at the inception of the directive promoting CHP to put on equal footing electricity produced from RES and the electricity produced via High Efficiency CHP.
This translated into a clear link in article 8 of D 2004/8 to the first RES-Electricity Directive (D 2001/77 “on the promotion of electricity produced from renewable energy sources in the internal electricity market”), and to the 2nd electricity market package (via Directive 2003/54 on “common rules for the internal market in electricity and repealing Directive 96/92/EC”).
In more details, article 8 introduces a direct reference to art.7 par. 1, 2 and 5 of D 2001/77 and to the “relevant provisions” of Directive 2003/54 (the most important provisions for the CHP sector are contained in art. 11 par 3. and art. 14 par 4.).
Certainty for stakeholder must be reinstalled:
But the entry into force of both the new RE Directive 2009/28 “on the promotion of the use of energy from renewable sources and amending and subsequently repealing Directives 2001/77/EC and 2003/30/EC” and of the Directive 2009/72 “concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC” have introduced the deletion of art.7 of D 2001/77 (effective since April 2010) and the repeal of the whole D 2003/54 (effective since March 2011) respectively.
Since then, the legislative framework at European level is unclear for CHP stakeholders and NRA alike.
Paragraph 5 of article 12 shall not be seen as introducing conflicting provisions as per the existing legislative framework (notably article 16 from RED 2009/28), but as reinstalling clarity for all stakeholders based on the spirit of the original legislations.
Safeguards from unintended consequence in other EU policy
Concerns have been expressed regarding guaranteed transmission and distribution and priority of dispatch for CHP and whether this could be maintained both for renewables and CHP. COGEN Europe finds that there is no practical issue today nor is there likely to be by 2020.1 The grid is changing significantly as the smart grid evolves. The smart grid will want to include CHP for its, high efficiency low carbon and supportive role to renewables2. The details of how the many challenges of smart grid will be handled technically are being managed by ACER (Reg 713/2009). ACER is currently engaged with the full stakeholder group producing framework guidelines to deal with the many emerging changes required in the grid to 2020. COGEN Europe suggests that this process is the correct forum for identifying new ways of operating the grid overall, while the EED should re-establish the policy priority of cogeneration as intended included and intended in the original Directive.
1 Difficulties of accepting wind electricity onto the grid: Spain effects less than 1% of generation, Denmark wind surplus is exported, Germany has the largest wind market in the world but difficulties to improve the overall grid transport capacity.
2 IEA 2011: Cogeneration and renewables. Solution for a low-carbon future
As regards maintaining the effectiveness of existing measures to reduce CO2 paragraph 5 of article 19 “Review and monitoring of implementation” introduces a safeguard clause “The Commission shall also monitor the impact of implementing this Directive on Directive 2003/87/EC, Directive 2009/28/EC as well as Directive 2010/31/EC” and provides for an opportunity for the RES-E sector to call a review of Art.12 if needed.
With the above explanations, Cogen Europe strongly supports the current proposals in the Commission’s EED on grid dispatch and access of cogenerated electricity.
Susidiary arguments
• Spirit of EU legislations, continuity is vital for all stakeholders:
– RES and CHP on an equal footing since the beginning of RES legislation in 2001
– Current Directive D 2004/8 refers to D 2001/77 + D 2003/54 on access to the grid system (via art.8)
– Broken links must be repaired
– Par 5 of Art 12 reinstalls the very much needed certainty businesses deserve
• Size of the problem:
– Data related to electricity produced from CHP and RES-E in the EU today and in the 2020
– Ideally, get a breakdown of the CHP fuel mix(more biofuel coming in?) + breakdown RES-E (focus on wind energy) today and in 2020
– Business cases are different for industrial, DHC networks, microchp…
• What are the alternatives for power generators if CHP are not to be promoted?
– More RES or more fossil-fired boilers and power plants having lower efficiency?  see change in mindset of gvts on incentives due to financial crisis
– CHP mix + avoidance of co2 + res prod
•Existence of a get-out clause if things go wrong for RES-E (par5. of art 19)
CHP & RES are in the same boat (IEA)
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