Last March 1st, 2017, the Ministry of Mining and Energy (“MINMINAS”) issued Decree 348 of 2017, “which amends Decree 1073 of 2015, in respect to the public policy guidelines upon efficient energy management and delivery of energy surpluses from small-scale self-generation” (the “Decree”).
The Decree sets forth the public policy grounds regarding energy efficiency-related management, as well as the delivery of energy surpluses from small-scale self-generators, to the Regional Transmission System (“STR” for its Spanish acronym) or to the Local Distribution System (“SDL” for its Spanish acronym), as applicable. Furthermore, the Decree amends a section to Decree 1073 of 2015 (Sole Reglamentary Decree of the Mining and Energy Administrative Sector), pursuant to which MINMINAS is responsible for the establishment and implementation of energy policies related to measurement systems to reach an efficient energy management. Likewise, MINMINAS should determine the implementation of such systems, as per the technical information provided by the entities that comprise the sector.
Regarding public policy related with small-scale self-generation, the Decree addresses the criteria for the recognition of a self-generator, provided that the generated power satisfies its own demand.
Along with keeping the rules related with the property of the generation assets and its operation by third parties, the Decree sets out that the amount of energy surpluses of the small-scale self-generator may be equivalent to any percentage of the value of its own demand. Moreover, the Decree indicates that the Mining and Energy Planning Unit (“UPME” for its Spanish acronym) will set the maximum installed power limits that will serve to technically identify these sorts of players within the market.
In respect with the conditions of connection and delivery of power surpluses of small-scale self-generators, the Decree delegates into the Energy and Gas Regulatory Commission (“CREG” for it Spanish Acronym) the establishment of a simplified procedure to connect and set up the delivery of power surpluses to the STR or to the SDL, as appropriate. Connection shall not be denied to self-generators except under technical circumstances duly supported. To the same extent, the Decree points out that CREG is responsible for the settlement of a compensation scheme for the delivery of power surpluses to the system, as well as for the liquidation and measurement guidelines. Particularly, in terms of compensation the Decree established the framework whereby small-scale self-generators generating with non-conventional sources of renewable energy will be paid by means of a bidirectional measurement scheme, used as energy credits. The latter, as per CREG´s regulation to be issued in this regard to implement Article 220.127.116.11.4.8 of Decree 348 of 2017. Until compensation of surpluses is regulated by CREG, the rules currently in force for the delivery of surpluses of large-scale self-generation shall apply.
Finally, the Decree disregards the requirement of executing a back-up contract by the small-scale self-generators with an installed capacity that is under or equal to 01 MW (100kW), and points out that UPME will define the terms and conditions to report the installed capacity and the power generation of small or large scale self-generators.
The Decree shall come into force on the date of its publication.
In the following link, please find the full text of the Decree: : Decree 348 of 2017