To prohibit system operators from owning energy storages – a lawyer about a draft law

The draft law No.2582, which provides for incentives for energy storages on the Ukrainian electricity market, has a number of risks for its normal operation.

This was said during a webinar on the legal regulation of energy storages in Ukraine, organized by the UBA Committee on Energy, Oil and Gas by Clean Energy Lab co-founder Oleksiy Mykhaylenko.

“An analysis of the draft law suggests that instead of providing incentives for energy storages, the draft law could weaken competition on the auxiliary services market. One of the biggest dangers that we saw in this draft law is to allow system operators, both transmission and distribution, to own energy storages”, Mykhaylenko said.

Lawyers have made general recommendations to the legislature. In order to stimulate the development of starages in Ukraine, the draft law:

1. Must remove existing regulatory barriers on the market. It should define fundamental principles, but not try to provide details of individual processes. Detailed provisions should be set out in by-laws.

2. Must clearly prohibit system operators from owning, building, using and managing storage systems that are used to provide services in organized segments of the electricity market – without any exceptions.

3. May include the definition of energy storage operations, which will provide the Regulator with a basis for distinguishing between energy storage operations and the purchase and sale of electricity in order to avoid double tariffs.

4. May include the definition of energy storages that distinguishes between storage systems used to participate in the market and those that are used as an integrated composite network.

5. Must determine the approach to the procedure for determining the possibility of exceptions to the rule prohibiting system operators from owning, using and managing accumulation systems.

6. May create incentives for renewable energy producers to use storages for activities not related to market participation, with the aim of more deeply integrating renewable energy sources into the market and providing them with greater flexibility on the balancing market.

7. Must not clearly indicate any technical characteristics of the technology. Such characteristics must not be determined by the legislative body, but by the executive branch in the established manner.

8. To consider the possibility of a separate definition of aggregators as market participants, that guarantees honest and barrier-free access to the market at a level with other participants.

Read also: Regulation for energy storage: an electric bike that is already in the fourth energy package

Tags: electricity, electricity market, energy storage, draft law, energy storage

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