Regulatory framework by business area - Enel Green Power


The Ministerial Decree of July 4, 2019 provided for competitive procedures based on Dutch auctions and registers, depending on the installed capacity and by technology groups, including photovoltaic systems. In particular, up to September 2021, seven procedures will be held with:
  • Dutch auctions for plants with a capacity of more than 1 MW; 
  • registers for plants with a capacity of less than 1 MW. 
Unlike previous decrees, the Ministerial Decree of July 4, 2019 provides for a new method for supporting renewable sources through two-way contracts for differences under which the successful tenderer returns any positive differences between the zonal price and the auction price.
These incentive mechanisms will terminate when an indicative cumulative annual cost of the incentives reaches €5.8 billion. At November 30, 2019 the indicative annual cumulative cost was around €5.0 billion.


Europe and Euro-Mediterranean Affairs


Last December, Law 4643/2019 was approved, transposing European legislation on priority dispatch and liberalizing access to forms of long-term bilateral contracting for the sale of electricity from renewable sources.
Also in December, the Ministry of Energy applied to the European Commission for extension of the current remuneration mechanisms for interruptibility services (Security of Supply Transitional Duty - SSTD and Transitory Flexibility Remuneration Mechanism - TFRM). Both mechanisms expired at the end of 2019. The SSTD, which has operated since 2016, is financed by all electricity producers, in particular renewable generators, based on revenue. The TFRM is funded by electricity consumers.
Greece has approved an ambitious national energy and climate plan, which sets new targets for the development of renewable sources equal to 35% of final gross energy consumption and includes a plan for the gradual closure of lignite-fired plants by 2023.
During 2019, competitive auctions awarded long-term supply contracts for approximately 1 TW of wind and photovoltaic capacity.


With the amendments of the energy law introduced last May, the incentive mechanism for renewable generation plants with a capacity of between 1 and 4 MW has changed. Starting from January 1, 2019, electricity generated by renewable plants will be sold through the Bulgarian energy exchange (IBEX) and will take account of spot electricity prices.


Africa, Asia and Oceania

South Africa

The main event was the publication in October 2019 of the new long-term electrical development plan (the Integrated Resource Plan or IRP). IRP 2019 envisages the withdrawal of 11 GW of coal capacity by 2030 (in parallel with 1,500 MW of new coal-fired plants). Furthermore, again by 2030, 6 GW of new solar photovoltaic and 14.4 GW of new wind are planned. The Carbon Offset Regulations have been published. They will allow renewable energy plants that meet certain requirements to generate emission reduction credits and to sell them to companies subject to the carbon tax.


The most important political event of the year was the federal election in May 2019, which saw the re-election of the conservative Liberal Party, which is in favor of a coal-based energy policy. The election result led to a slowdown in the renewable energy market, with a significant decline in capacity under development (-60% compared with the investments recorded in the previous year according to BNEF). The stalemate is exacerbated by the complexity and length of connection and permitting processes.
These developments are complicated by the uncertain outcome of two procedures (Coordination of Generation and Transmission Investment - Post 2025 Market Design for the NEM) currently under way, which could lead to the overall redefinition of the National Electricity Market (NEM). However, the draft decisions prepared to date by the competent authorities confirm some of the schemes deemed ineffective by most investors (e.g. management of losses on transmission networks).



Last year saw the re-election of Prime Minister Modi, which will continue his policy of supporting renewables over the next five years. 12 GW were installed in 2019 alone, bringing renewables capacity in the country to 86 GW.
Various regulatory measures have been introduced to encourage renewables, including a 25-year exemption from transmission costs for wind and solar projects and a the reduction in the corporate tax from 34% to 25%.