The summer was not as quiet as usual. It witnessed the arrival of what is being called the G-fee, a fee that electricity producers will have to pay from the beginning of 2014 to access the transmission and distribution system. The level of the G-fee is linked to a producer’s reserved system access capacity.
Slovakia’s largest electricity producer, Slovenske elektrarne (a subsidiary of Enel), which allegedly will have to pay G-fees of as much as EUR 70 million, has already signaled a potential lawsuit to challenge it. The G-fee has also drawn the attention of the European Commission (“EC”), as EU law prescribes a EUR 0.5/MWh limit on such fee. In a letter addressed to the chairman of the Slovak regulatory authority RONI, the EC notes that no CEE country applies a G-fee, and expresses the concern that implementation of such fee may lead to market distortions. However, in an explanatory letter sent to the EC, the RONI chairman assured that the regulation implementing the G-fee is in line with all EU law limitations.
Slovenske elektrarne is not the only energy producer voicing its discontent with recent developments in the energy regulatory framework. Representatives from photovoltaic power plants have already raised concerns about the planned introduction of a special tax on photovoltaic power plants. In Slovakia, the support for the photovoltaic industry is reflected in the average household final electricity bill by about 4.5%, while investors were initially promised support for 15 years.
However, the Slovak government has already started working on the instruments that would axe support to the photovoltaic industry. In doing so, it may be tempted to look for inspiration to the neighboring Czech Republic, where the government has implemented a 26% special tax on PV plants that came into operation in 2009 and 2010. The Czech Constitutional Court has declared the tax constitutional, stating that it does not amount to discrimination since the unequal treatment was justified by the lower costs of constructing the plants. Investors have reportedly already filed claims under the relevant bilateral investment protection treaties.
The courts have also contributed to the summer’s activity. Following a lawsuit filed by Greenpeace, the Supreme Court quashed a decision from the Nuclear Regulatory Authority (“NRA”) approving a change of structure in connection with the building of Unit 3 and 4 of the Mochovce Nuclear Power Plant.
The Court found that NRA’s decision violated the rights of Greenpeace as a party to the proceedings, protected under the Aarhus Convention. The NRA will have to conduct the proceedings on change of the building permit again. However, the Supreme Court ruling should not have a detrimental effect on the interests of the investor as the NRA allowed the construction works to continue pending the outcome of the new proceedings.