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Guidelines of the President of the Energy Regulatory Office on doubts concerning the connection of installations operating in the cable pooling scheme

20 May 2024 | Knowledge, News, The Right Focus

The EU is seeking to electrify not only the energy sector but also many other sectors of the economy. As a result, the demand for electricity is increasing. The draft update of Poland’s Electricity Policy until 2040 (PEP2040)[1] foresees an increase in electricity demand of around 2,000 ktoe in 2030 compared to 2020, with the application of energy-saving solutions. As a total of 8,356 MW of coal and brown coal unit capacity is planned to be withdrawn by 2030,[2] the demand for power from renewable energy sources will also increase. At the same time, experts estimate that the deficit in installed renewable energy capacity is already 16 GW due to the increasing number of connection refusals.[3] The new PEP2040 not only sets higher targets for RES development, but also specifies the guidelines that electricity system operators (ESOs) must take into account in their grid development plans. Among other things, the policy talks about the dynamic development of new capacity, including zero-carbon capacity in the electricity sector.

The full development of the RES industry therefore requires not only a friendly regulatory environment, but also:

  • Increasing the capacity of electricity grids
  • Removing barriers to connecting new generation capacity

Cable pooling is a solution that has the potential to accelerate the increase of renewable energy capacity, but also raises a number of questions. We analyse the guidelines of the President of the Energy Regulatory Office (URE)[4] regarding the installation of RES in this scheme and reiterate our earlier discussion of the guidelines of the URE President on doubts about the public and commercial grid connection of RES installations.

What is cable pooling

Cable pooling is the sharing of a connection by generation installations which usually have different operating characteristics (e.g. PV and onshore).

In accordance with the Energy Act, two or more RES installations belonging to one or more entities may be connected to the electricity grid with a rated voltage higher than 1 kV at a single location.[5]

In the cable pooling scheme, it is necessary to obtain connection conditions and then conclude a single connection agreement.[6] In this case, in accordance with the law, the agreement must contain additional elements, in particular:

  • A cable pooling agreement concluded by all entities sharing the connection, together with the identification of the representative party concluding the agreement
  • The definition of the rules for the joint exercise of rights and obligations under:
    • Connection conditions
    • Connection agreement
    • Agreement for the provision of electricity transmission or distribution services
  • Definition of the rules for the sharing of sets of equipment for power evacuation up to the demarcation point between the ownership of the energy company’s grid and the installations of the connected entities

Conditions for installations in a cable pooling system

The implementation of a cable pooling system is based on the use of a hybrid RES installation.[7]

This is an installation consisting of equipment connected to the electricity grid at a single location and generating electricity exclusively from RES, which differ in the type and availability characteristics of the electricity generated.

The set of such equipment must meet the following conditions:

  • None of the generating equipment may have an installed electrical capacity greater than 80% of the total installed electrical capacity of that set of equipment
  • The evacuation of power from the equipment in that set to the electricity grid is carried out by a device connecting that set to the electricity grid and designed to convert the energy to the conditions necessary for its injection into that grid
  • The set of equipment includes an energy storage device for storing electricity from the generating equipment included in the set, where the proportion of electricity from the generating equipment injected into the electricity grid via the energy storage device to the total amount of electricity injected into the grid is not less than 5% per year, not including electricity withdrawn from the grid

The connection of hybrid RES plants raises a number of questions and practical problems, such as whether it is possible to add more generation sources to an existing installation, whether the same technologies can be combined and what the rules are for applying for support schemes.

Let’s take a look at the guidelines issued by the President of the URE.

Guidelines of the President of the URE on cable pooling

In accordance with the guidelines of the President of the Energy Regulatory Office, cable pooling is applicable to new RES installations as well as to the expansion of existing RES installations with additional generation sources.

A connection may be shared on the basis of an application for connection conditions:

  • For the first grid connection of two or more RES installations
  • In a situation where connection conditions and the relevant agreement have been previously issued and concluded for the ‘first’ RES installation and the entity to be connected applies for connection of a second or subsequent RES installation
  • In a situation where one RES installation is connected to the grid (existing installation and a constructed connection) and the connected entity applies for the connection of a second or subsequent RES installation

Cable pooling also applies to installations connected to the grid prior to the adoption of cable pooling regulations.[8] Installations of the same or different technologies (e.g. two PV or PV and onshore) can share the connection. Cable pooling can be used by one owner or by several owners (in the latter case it is necessary to work out a cooperation model, including the appointment of an entity to conclude the connection agreement and a transmission/distribution service agreement for the whole installation).

The cable pooling regulations apply in the event of:

  • An increase in the declared connection capacity by an entity that has entered into a connection agreement involving cable pooling
  • A change in the technical parameters of the equipment and installations comprised in the connected cable pooling installation, including an increase in their installed electrical capacity

With regard to the use of a support scheme (FIT/FIP systems of RES auctions), a producer of energy in a ‘planned installation’ (to be added to an existing installation) is not entitled to use RES support schemes if the producer of energy in the ‘first’ installation is a beneficiary of the aforementioned schemes.

In conclusion, it can be expected that the practice of ESOs in connecting RES installations in the cable pooling scheme will be standardised, not only due to the position of the President of the URE, but above all due to a number of other factors, such as:

  • Growing energy demand
  • The gap created by the withdrawal of coal-fired units
  • The need to stabilise energy production from RES

Any questions? Contact us

Milena Kazanowska – Kędzierska

Aleksandra Pinkas

 

[1] Annex 1 to the EPCIP Transition scenario in market and technical conditions, p. 78

[2] Ibidem, p. 18.

[3] Cf. Forum Energii, RES pooling. Potential of cable pooling in Poland, p. 3, in which experts point out that grid operators refused the connection of 51 GW of RES capacity in 2022 alone.

[4] Information from the President of the Energy Regulatory Office no. 15/2024 of 22 March 2024 on the issues that cause the most frequent doubts regarding connection to the grid.

[5] Article 7(1f) of the Energy Law of 10 April 1997 (Journal of Laws of 2024, item 266), which provides that: “two or more RES installations belonging to one or more entities may be connected to the electricity grid with a rated voltage higher than 1 kV at a single connection point. The first sentence shall not apply to RES installations where the grid connection point is an installation of an end consumer”.

[6] Article 7(1g) of the Energy Law

[7] Article 2(11a) of the Renewable Energy Sources Act of 20 February 2015 (Journal of Laws of 2023, item 1436, as amended), the ‘RES Act’

[8] i.e. before 1 October 2023, when the amendment of the RES Act in this respect came into force

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Contact us:

Milena Kazanowska – Kędzierska

Milena Kazanowska – Kędzierska

Attorney-at-law / Senior Associate / Energy, Infrastructure, Environment Protection, ESG

+48 539 908 918

m.kazanowska@kochanski.pl