Regulations, 2015

L.N. 170 of 2015

MALTA RESOURCES AUTHORITY ACT

(CAP. 423)

Sale of Electricity generated from Cogeneration Units

Regulations, 2015

IN exercise of the powers conferred by article 28(1) of the Malta

Resources Authority Act, the Minister for Energy and Health, after

consultation with the Malta Resources Authority, has made the

following regulations:-

(1)

The title of these regulations is the Sale of Citation and

purpose.

Electricity Generated from Cogeneration Units Regulations, 2015.

(2) The purpose of these regulations is to regulate the sale of

electricity generated from cogeneration units and supplied to the

distribution system operator.

(Regulation 7)

Total maximum cogeneration unit electricity capacity MWe that

may be approved for the payment of the marginal cost per annum for

any electricity generated and sold to the distribution system operator

from such cogeneration unit capacity shall be 3MWe each year.

(1)

Unless otherwise stated in these regulations, Interpretation.

the definitions in the Act shall apply.

(2) In these regulations, unless the context otherwise requires

"the Act" means the Malta Resources Authority Act;

"annual", "annum" or "year" means the period of time

commencing on the 1st January and ending on the 31st December of

each year as prescribed in the Second Schedule;

"the Authority" means the Malta Resources Authority as

established by the Act;

"change of use of premises" means the change in the

classification of a premises in terms of these regulations whether

domestic or residential or non-residential or institutional household;

"co-generation" means the simultaneous generation in one

process of thermal energy and electrical or mechanical energy;

"cogeneration unit" means a unit that is able to operate in

cogeneration mode;

"commissioned" means the first time a cogeneration unit is put

into operation, following the establishment of operational readiness;

"consumed on site" means consumed on the same premises

where the cogeneration unit is installed;

"distribution" means the transport of electricity on high voltage,

medium voltage and low voltage distribution systems with a view to

its delivery to consumers, but not including supply;

"distribution system" means all the interconnected technical

facilities used for conveying electricity to final customers;

"distribution system operator" means a person responsible for

operating, ensuring the maintenance of and, if necessary, developing

the distribution system in a given area and, where applicable, its

interconnections with other systems and for ensuring the long-term

ability of the system to meet reasonable demands for the distribution

of electricity;

"domestic premises" means premises which include private

dwellings with no persons registered with the distribution system

operator as residing in them such as second homes, or private garages

and common areas including roofs, stairs, terraces, gardens to

buildings which are used solely for private dwellings;

"electricity from cogeneration" means electricity generated in a

process linked to the production of useful heat and calculated in

accordance with the methodology laid down in the First Schedule of

the Energy Efficiency and Cogeneration Regulations;

"installation operator" means the holder of the licence to

generate electricity from the cogeneration unit;

"institutional households" shall include the following premises

(a)

healthcare institutions such as premises used as a

hospital, nursing home or as any institution providing medical

or nursing care;

(b)

institutions for retired, elderly or disabled persons,

including premises used as a home for the retired or elderly

persons or persons with any disability;

(c)

educational institutions including premises used as

a boarding school or for similar purposes;

(d)

care institutions including premises used as

orphanages, shelter homes, open centres for refugees or for

similar purposes;

(e)

religious institutions including premises used

as convents, retreat houses, or for similar purposes;

(f)

military institutions such as military barracks;

(g)

other institutions including premises used as

boarding houses, penal or correctional facilities or for similar

purposes;

"kVAh" means kilo Volt Ampere hour;

"kW" means kilo Watt;

"kWh" means kilo Watt hours;

"marginal cost per KWh" means the additional cost of

producing one more unit as prescribed in the Second Schedule;

"metering equipment" means the electricity meters provided by

the distribution system operator including smart meters, any voltage

and current transformers and any other associated equipment and

wiring required to measure the quantity of electricity supplied or

exported;

"the Minister" means the Minister responsible for resources;

"MWe" means the electricity capacity rating of a cogeneration

unit;

"nominal installed capacity" means the nominal electricity

rating MWe as defined on the rating plate of the cogeneration unit;

"non-residential premises" means a building or plot of land

which is used wholly or mainly for the purpose of conducting an

economic activity, but does not include any building such as private

garages or common areas to buildings which are used solely as

private dwellings;

"operational readiness" means the capability to function in

accordance with design and specifications;

"premises code" means a unique number assigned by the

distribution system operator identifying a particular premises with its

individual service address and served with electricity and, or water;

"renewable energy sources" means renewable non-fossil energy

sources, that is, wind, solar, geothermal, wave, tidal, hydropower,

biomass, landfill gas, sewage treatment unit gas and biogases;

"residential premises" means any premises used solely and

regularly as a private dwelling where at least one person resides but

does not include institutional households;

"scheduled" means in accordance with the scheduled

programme of ARMS Limited for the taking of periodic electricity

meter readings;

"smart meters" shall have the same meaning as in the Electricity

Supply Regulations.

(Regulations 4, 5, 6 and 7)

Marginal cost per kWh applicable for electricity generated by the

cogeneration units and exported to the distribution system

The marginal cost per kWh referred to in regulations 4, 5, 6 and

7 shall amount to the marginal cost per kWh as approved by the

Authority from time to time.

The Authority may define which cost items may be considered

in the determination of the marginal cost per kWh of electricity

incurred by the distribution system operator.

The marginal cost per kWh for the year 2015 shall be of ten

cents and five mils (€0.10,5) per kWh.

B

€0.90

These regulations shall apply to electricity exported to the

distribution system from any cogeneration unit equipped for the

recuperation and utilization of the thermal energy produced and

producing electricity from fossil fuel or renewable energy, installed

either in a residential or domestic premises or non-residential or

institutional household and connected to the distribution system

either directly or indirectly with the appropriate protection and

metering equipment provided by the distribution system operator.

(1)

In the case of any cogeneration unit commissioned

and connected to the distribution system in terms of regulation 3, the

installation operator may

(a)

either sell all the electricity generated by the

cogeneration unit to the distribution system operator and be paid

by the distribution system operator the marginal cost per kWh

under the Second Schedule; or

(b)

generate electricity primarily for own consumption

and be paid by the distribution system operator the marginal

cost per kWh under the Second Schedule for any excess

electricity generated and exported to the distribution system

Provided that the consumption of the electricity

generated, in accordance with this paragraph, may only be done

by the installation operator who is a registered consumer with

the distribution system operator with respect to the same

premises code where the cogeneration unit is installed.

(2) The electricity generated -

(a)

from cogeneration units separately installed shall

be separately metered; and

(b)

from solar photovoltaic installations or other

renewable energy sources connected with the same premises

code as cogeneration units installed in terms of sub-regulation

(1) shall also be separately metered.

(3) In the case where the installation operator takes the option

available in terms of sub-regulation (1)(b), the distribution system

operator shall install metering equipment to measure all the electricity

generated by the cogeneration unit in addition to the import/export

metering equipment.

Without prejudice to the generality of the foregoing, subject to

the obtainment of the consent of the distribution system operator, the

installation operator may install metering equipment to measure all

the electricity generated by the cogeneration unit as an alternative to

the installation of metering equipment by the distribution system

operator for the purpose of measuring all the electricity generated by

the cogeneration unit.

(4) An installation operator who generates electricity from a

cogeneration unit connected with the same premises code as solar

photovoltaic installations installed primarily for own consumption

and exporting any excess electricity to the distribution system and, or

other installations generating electricity from renewable energy other

than solar photovoltaic installations, being all installed with the

option to generate primarily for own consumption, shall for any

excess electricity generated and exported to the distribution system be

paid by the distribution system operator at the marginal cost per kWh.

(1)

The payment for the electricity produced from the Commencement

cogeneration unit and sold to the distribution system operator shall be and

payment.

due from the date when the cogeneration unit is first connected to the

distribution system as provided in regulation 3.

(2) The payment of the marginal cost per kWh shall be subject

to the approval of the cogeneration capacity as required in these

regulations.

(3) The payment effected by the distribution system operator

to installation operators for electricity generated by cogeneration

units in accordance with regulation 3 shall be deemed to be inclusive

of any compensation for loss of revenue arising from any planned and

unplanned interruption which impedes the export of electricity from

the cogeneration unit to the distribution system.

(1)

The eligibility for the payment for any electricity Eligibility for

generated by the co-generation unit and sold to the distribution payment

electricity sold

system operator is subject to

to the

distribution

system operator.

(a)

the cogeneration unit obtaining all the necessary

authorisations, licences or permits from the relevant competent

authorities and the distribution system operator;

(b)

the cogeneration unit is equipped with metering

equipment that measures all the electricity generated by the

cogeneration unit in addition to the import/export metering

equipment;

(c)

the installation operator’s compliance at all times

with the obligations established in these regulations, the

Network Code and all other applicable legislation.

(2) The payment of the marginal cost per kWh shall only be

applicable up to the total amount of electricity sold to the distribution

system as measured by the metering equipment provided by the

distribution system operator and to the extent of the cogeneration unit

MWe capacity approved by the Authority

Provided that the approval of cogeneration MWe capacity

by the Authority shall be subject to the overall cap for the MWe

capacity that may be approved in any year as established by the

Second Schedule.

The total maximum cogeneration electricity capacity MWe

that shall be eligible for the sale of electricity to the distribution

system operator and the payment of the marginal cost per kWh by the

distribution system operator for exported electricity from such

cogeneration unit after the entry into force of these regulations shall

be that established in the First Schedule.

(1)

The distribution system operator may set off

amounts due by an installation operator for the supply of electricity

against amounts due to the installation operator for the exporting of

electricity under these regulations

Provided that such setting off shall only be permissible

where the claims are undisputed or are certain, liquidated and due.

(2) Where a set-off arrangement between the installation

operator and the distribution system operator is in place and the

amounts due to the installation operator for the exporting of

electricity referred to in sub-regulation (1) are in excess of the

amounts due by an installation operator for the supply of electricity

by the distribution system operator, the distribution system operator

shall credit the installation operator the balance due by means of a

credit note

Provided that the installation operator may request to be

paid the balance due by means of such credit note, after four

consecutive scheduled billing periods for the supply of electricity by

the distribution system operator to the installation operator, have

elapsed.

(3) Where no set-off agreement exists between the installation

operator and the distribution system operator and the amounts due to

the installation operator for the exporting of electricity are in excess

of the amounts due by an installation operator for the supply of

electricity by the distribution system operator, the distribution system

operator shall credit the installation operator the balance due, which

shall be paid to the installation operator within sixty days from the

scheduled reading of the metering equipment

Provided that the distribution system operator shall carry

out the reading of the metering equipment within intervals of at least

two months, to be reckoned as from the date of the first reading of the

metering equipment.

Installation operators shall

Obligations of

the installation

operator.

(a)

submit such

information

as

the

Authority

may reasonably require;

(b)

inform the Authority and the distribution system

operator, in the form and manner they may reasonable require, if

the cogeneration units have been disconnected or transferred,

sold or in any form modified in such a way as to change their

performance;

(c)

comply at all times with the provisions of

the applicable legislation, notification, authorisation, licence

conditions and Network Code as approved by the Authority;

(d)

make available to the distribution system operator

and to the Authority data required to be recorded for the

purposes of these regulations.

Where an installation operator is deceased, or by reason of Succession of

any other act or event, permanently ceases to be the installation obligations

benefits.

operator, payment for electricity generated by the cogeneration unit

and exported to the distribution system under these regulations may

be transferred to the new installation owner

Provided that

(a)

the new installation operator informs the

distribution system operator and the Authority of such change in

ownership in such form and manner as they may establish,

together with any documentary proof and information that they

may establish for such purposes;

(b)

the new installation operator takes over all

obligations held by the previous installation operator;

(c)

such person shall not be considered by the

distribution system operator and, or the Authority as a new

installation operator if such installation operator is not in

compliance with any other law, permit or any requirement in

relation to the cogeneration unit.

(1)

Modifications relevant to the cogeneration unit

installation arising from -

(a)

change of use of the premises where the

cogeneration unit is located;

(b)

change of account holder;

(c)

transfer of the cogeneration unit to another

different premises with same use;

(d)

transfer of cogeneration unit to another different

premises with different use;

(e)

change of the option from "sell all the electricity

generated" to "generate electricity primarily for own

consumption" or vice versa,

shall only be made after obtaining the necessary permits and

clearance from the Authority and the distribution system operator.

(2) In the case where an installation operator increases the

generation capacity of a cogeneration unit which is connected to the

distribution system, the payment of the marginal cost shall apply for

the whole unit as extended, provided that the installation operator

obtains all the necessary authorisations, licences and permits.

(3) The changes listed in sub-regulations (1) and (2) shall

become applicable for the payment of the marginal cost from the date

of the first meter reading taken after the date of submission of an

application to the distribution system operator to approve and take the

necessary action.

Installation operators shall not be entitled to any tradable

certificates including tradable guarantees of origin for electricity

generated from the cogeneration unit.

The provisions dealing with access, inspection, Access,

modification or tampering of meters found in the Electricity Supply inspection,

of metering

Regulations shall mutatis mutandis apply to installation operators equipment.

under these regulations in the same manner as provided for in those

regulations.