Sustainable
y g r Ene TARIFF GUIDELINE
SMALL-SCALE SUSTAINABLE ELECTRICITY PROVISION FURTHER PRESCRIPTIONS FOR DETERMINING THE TARIFFS FOR RETRO-SUPPLY AT THE CONNECTION OF INSTALLATIONS FOR INDUSTRIAL GENERATION OF SUSTAINABLE ELECTRICITY TO THE PUBLIC TRANSPORTATIONAND DISTRIBUTION NETWORK OF CURAÇAO
22 November 2011
TABLE OF CONTENTS
ARTICLE 1: Definitions ......................................................................................................................................... 2
ARTICLE 2: Legal basis and backgrounds of the guideline ................................................................ 2
ARTICLE 3: Points of departure ....................................................................................................................... 3
ARTICLE 4: Tariff and invoicing private and small business applicants ...................................... 3
ARTICLE 5: Tariff and invoicing bigger business applicants.............................................................. 4
ARTICLE 6: Net (= Mains) connection agreement .................................................................................. 4
ARTICLE 7: Duty to inform network company and applicants ......................................................... 5
ARTICLE 8: Special Regulatory Account....................................................................................................... 5
ARTICLE 9: Final provisions ............................................................................................................................ 5
TARIFF GUIDELINE: SMALL-SCALE SUSTAINABLE ELECTRICITY PROVISION | ii
TARIFF GUIDELINE SMALL-SCALE SUSTAINABLE ELECTRICITY PROVISION
TARIFF GUIDELINE: SMALL-SCALE SUSTAINABLE ELECTRICITY PROVISION | 1
ARTICLE 1: DEFINITIONS 1. In accordance with the Policy Paper Small-scale Sustainable Electricity Provision (to be referred to hereinafter as the Policy Paper), in this guideline the following concepts shall be defined and interpreted as follows: a. Applicant: the private or business end-user who wishes to obtain a connection of his generating unit to the public transportation- and distribution net (also to be referred to hereinafter as: the net). b. Retro-supply: the supply to the net by applicants of sustainable energy, which they themselves do not use as end-users. c. Network- or distribution company: Integrated Utility Holding N.V. (or Aqualectra Distribution). d. Tariff for retro-supply: the tariff which is compensated to the applicants by the network company when they supply back sustainable electricity to the net. e. Balancing: effecting the settlement of electricity supplied by an applicant against the same tariff as the one at which he purchases electricity from the distribution company. f. Minister: the minister in charge of energy matters. g. Supervisor: the Bureau Telecommunication and Post. h. Ordinance on Pricing: the Ordinance on Pricing (P.B. 1961, no. 117).
ARTICLE 2: LEGAL BASIS AND BACKGROUNDS OF THE GUIDELINE 1. In the Policy Paper, which was approved by the Council of Ministers on November 16th, 2011, a new regime has come into being for the connection of installations for small-scale sustainable production of electricity to the public electricity network. Said connection entails the possibility of retro-supply. Retro-supply, among other things, is attendant with a tariff for retro-supply. The tariff for retro-supply is subject to the prescriptions of the Ordinance on Pricing. 2. Pursuant to article 2, paragraph 1, sub a, of the Ordinance on Pricing the Government of Curaรงao is empowered to take action in the determination of prices for goods and services, by stipulating minimum- or maximum prices. Furthermore it has been pointed out in the Policy Paper that the tariffs for retro-supply are determined on the basis of a tariff procedure to be approved by the Minister. The latter statement refers to the provisions in this guideline.
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ARTICLE 3: POINTS OF DEPARTURE 1. The purpose of the tariffs for retro-supply is to offer applicants, being small producers of sustainable electricity, an adequate compensation, based on cost for the green energy generated by them and supplied to the net. By providing these small producers a reasonable “return on investment� during a reasonable period of return, in addition the development of a diversity of clean technologies for generating energy, are stimulated. On the other hand the tariffs for retro-supply must not entail unreasonable costs for the network company. 2. The primary point of departure is thus the attainment of a retro-supply tariff which is reasonable for both parties. At the determination of a reasonable retro-supply tariff, in the first place the following specific points of departure must be met: a. the compensation should enable the recovery of at least the cost price of the energy produced by the applicant during the period of return on his investment. b. the compensation must be reasonable for the network company from a business economics viewpoint and in proportion to, at any rate not exceed, the purchase cost of the energy sources which are saved as a consequence of the retro-supply. In other words: the amount of the retro-supply tariff is confined by the amount of the purchase cost saved. c. The compensation should also take into account the financial consequences, if any, for the network company, among which, at any rate, are the costs of balancing, as referred to in article 4, first paragraph, of this guideline. 3. Eventually in the second place other considerations might play a part at determining a reasonable compensation, such as environmental and economic considerations.
ARTICLE 4: TARIFF AND INVOICING PRIVATE AND BUSINESS APPLICANTS 1. For private applicants, likewise as small business applicants with generating units up to 10 kW, which are treated equally, there are two tariffs for retro-supply: a. At balancing the relevant tariffs for supply of the distribution company are applied. For balancing, however, a ceiling has been established and this is the quantity of electricity which is supplied by the distribution company to the private applicant and
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b. additionally the distribution company pays the private applicant a tariff for retro-supply based on cost price, which will be determined by the Minister based on the Ordinance on Prices, after advice received from the supervisor. 2. In the event that in a given month the private applicant supplied less to the net than he consumed, then an invoice will follow each month from the network company by which the net consumption (consumption minus the quantity supplied back) is invoiced to the applicant at the supply tariff. 3. In the event that the private applicant in a month supplied back more to the net than he consumed, the network company determines the surplus quantity of kWh, which the end-user may then take as surplus balance (credits) on his account to the following month. This process is repeated each month and works cumulatively, through which the unused balances are taken into the next month until the end of the calendar year. At that moment a remaining surplus balance, if any, (in this case accumulated credits) is made payable to the private or small business applicant by the network company at the retro-supply tariff, and then commences a new cycle of supply and retro-supply.
ARTICLE 5: TARIFF AND INVOICING BIGGER BUSINESS APPLICANTS 1. To business applicants with a generating unit greater than 10 kW the network company pays back at a retro-tariff based on cost price, which will be determined by the Minister based on the Ordinance on Pricing, after advice obtained from the supervisor. 2. In this case invoicing takes place monthly by the network company on net basis, whereby net is the difference between the amount receivable by the network company (from the business applicant) in accordance with the supply tariff and the amount payable (to the business applicant) in accordance with the retro-supply tariff.
ARTICLE 6: NET CONNECTION AGREEMENT 1. The retro-supply tariff, which is applicable to the applicant shall be inserted in the subscription or net connection agreement by the network company, as referred to in paragraphs 2.3 and 2.4 of the Policy Paper.
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2. The net connection agreement enables an annual adaptation of the retro-supply tariff. At adaptation of the retro-supply tariff the applicant is informed by the network company within seven days after the adaptation enters into force,
ARTICLE 7: DUTY TO INFORM NETWORK COMPANY AND APPLICANTS 1. The network company is under obligation to periodically provide the necessary information regarding retro-supply according to the most recently indicated format. About the nature of the information to be provided, as well as the periodicity of same, the supervisor will consult with the network company, prior to determining same. 2. The applicant is under obligation, at the request of the supervisor, to provide the necessary information, according to the most recently indicated format.
ARTICLE 8: SPECIAL REGULATORY ACCOUNT 1. The financial consequences, if any, of retro-supply for the network company, inclusive of the costs, if any, relative to the safeguarding of the continuity of supply, are recorded by the network company in a special “regulatory account”. In this “regulatory account” also may be recorded the financial effects of the differences which come into being because the reality deviates from the prognoses that were departed from. 2. Additional costs (for the network company) may be compensated through adaptation of the tariffs (or eventually by subsidies), whereas higher yields (idem) will be processed through the tariffs. 3. The size of the “regulatory account” shall be determined annually at the end of the calendar year (t) and, if necessary, in the subsequent year (t+1) it will be processed through the retro-supply tariffs.
ARTICLE 9: FINAL PROVISIONS 1. This tariff guideline shall enter into force as of January 1st, 2012. 2. Annually the guideline will be evaluated by the supervisor. A report will be drawn up from the evaluation by the supervisor on behalf of the Minister.
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3. The evaluation, referred to in the second paragraph takes place in the first ten weeks of the first quarter following the year which is subject of the evaluation. Based on the evaluation and a request, if any, from the network company for the adaptation of the retro-supply tariffs, new retro-supply tariffs and terms and conditions of the retro-supply shall be determined, if necessary. The tariffs and conditions referred to may be promulgated to enter into force retroactively as of the 1st of January of the year in which the evaluation takes place. 4. These guidelines may be deviated from, in the event that: a. the consequences caused by the application of this tariff guideline clearly deviate from the objectives that the Policy Paper aims at, or b. said application has, or threatens to have disproportionately disadvantageous consequences, for interested parties. 5. For a deviation as referred to in the fourth paragraph, approval from the Council of Ministers is at all times required, at a proposal of de Minister.
All this as determined by the Council of Ministers on [..] November 2011 ***
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