Incorporation of the mechanism for selling electric energy from renewable sources to distributors.
Power Department Report | Incorporation of the mechanism for selling electric energy from renewable sources to distributors
Dear Sir or Madam,
Through Resolution No. 370/2022, dated May 13th, 2022, and published in the Official Gazette on May 16th (the “Resolution”), the Secretariat of Energy established the incorporation of the “Mechanism for the Selling of Electrical Energy from Renewable Sources to Distributors” (the “Mechanism”), to enable the commercialization of electrical energy from renewable sources between Distribution Agents of the Wholesale Electricity Market (“WEM”) and/or Providers of the Public Distribution Service with Generating, Self-generating and Co-generating Agents within the framework of the Commercial Transactions in the WEM.
According to the Resolution, the Mechanism aims for WEM Distribution Agents and/or Public Distribution Service Providers to be able to sign Term Market Contracts to satisfy the demand of their customers declared as Large Demands with consumption greater than or equal to Three Hundred Kilowatts (300 KW) called GUDIs.
The scope of the Mechanism is limited to the commercialization of electrical energy from renewable sources between WEM Distribution Agents and/or Public Distribution Service Providers with Generator, Self-Generator, and Co-Generator Agents within the framework of WEM Commercial Transactions.
The Resolution instructs the COMPAÑÍA ADMINISTRADORA DEL MERCADO MAYORISTA ELÉCTRICO SOCIEDAD ANÓNIMA to agree with the Distribution Agents of the WEM and/or Providers of the Public Distribution Service and the Generating Agents, Self-generators and Co-generators involved, the procedures to carry out the operative communications, as well as the minimum information requirements to be supplied for programming, dispatch, and commercial transactions.
The Annex to the Resolution provides, among other things, that:
• The contractual conditions – duration, allocation priorities, prices, and other conditions- may be freely agreed by the parties.
• The energy supplied by the same Generating Agent to different Large Users, Self-Generators, or Authorized Distributors with whom it has entered into Contracts within the framework of this Mechanism, will be assigned among them according to the priority that is informed by the Generator or Marketer.
• The energy demand of the Authorized Distributor supplied through the executed Contracts will be valued at the prices agreed between the parties and will be billed directly by the Generator to the Authorized Distributor.
Please, do not hesitate to contact us should you require any further information on this matter.
José Carlos Cueva