Greece to overhaul licensing regime which puts the brakes on solar

• The energy ministry has published a plan to radically simplify the renewable energy permitting process. The new system is expected to come into force as early as next month and will be applied retroactively to address a 22-month backlog in generation license applications.

The Greek government has surprised its renewable energy sector by announcing an overhaul of the country’s creaking project licensing regime.

The pro-business government’s proposal could constitute the most significant policy development in the sector for years with renewables developers having been perennially hamstrung by the sluggish pace of new permit approvals.

A plan sketched out by the Hellenic Ministry of Environment and Energy this week would abolish the existing electricity generation license. In its place, clean energy investors will simply have to log in to a digital database to secure a generation certificate code.

The current system requires developers to secure a generation license from the infamously slow Regulatory Authority for Energy (RAE) to be eligible for renewable energy generation capacity auctions.

The government ministry charged with overhauling the system said 1,891 of the 2,346 applications for generation licenses submitted since 2016 are still pending. The ministry claims developers need to wait an average of 18 months for applications to be processed.

As a result of investors being left in generation license limbo, Greece’s renewable energy tenders have consistently been under-subscribed.

The government, which has pledged to phase out coal by 2028, says the clean energy licensing roadblock needs to be removed if Greece is to achieve its target of installing 5 GW of new solar generation capacity by 2030.

With the generation license process the top priority, however, the ministry said the entire licensing regime would be scrutinized, including the issuance of environmental permits – an announcement that may alarm environmentalists.

Detailed information

The government said a parliamentary bill expected to be brought to parliament next month would replace the current generation licenses with the digital process.

Under the new regime, developers will submit online applications every February, June and October and will only be required to supply minimal project data, such as generation capacity and location. The certificates issued will be valid for 25 years.

The one-off fee investors will pay for generation certificates – which should be issued within hours – will be linked to project generation capacity. For solar projects up to 1 MW in size, a €1,250-2,000 charge will be levied. For facilities up to 10 MW in scale, the fee will be €1,000-1,500 per megawatt of capacity. Larger assets, up to 100 MW, will have to stump up €750-1,250/MW and the biggest sites will pay €500-1,000/MW.

Developers will be able to track the progress of applications online and, once a certificate is awarded, the 25-year term ensures they will not face the cost of extending permissions.

A strict timeline for project commissioning will be applied, with developers required to submit an environmental study within six months of receiving a generation certificate and obliged to apply to connect projects within two months of environmental permits being issued. The tighter schedule reflects the keenness of the government to accelerate its clean energy plans.

In a further boost for developers, the government announced all generation license applications received since March 2018 will be eligible for the new system. pv magazine understands that is the point the RAE has reached in processing the backlog.

Paradigm shift

Not surprisingly, Greece’s renewables sector greeted the news with enthusiasm.

Stelios Psomas, policy officer at the Hellenic Association of Photovoltaic Companies (Helapco) told pv magazine: “Helapco had introduced such a system [for its licensing process] since 2017 and has been steadily pushing for the abolition of generation licenses ever since. It was, in fact, the only renewable energy stakeholder to make such a request over time. We are, therefore, pleased.”

Psomas added, the government bill to be presented in parliament next month will also include reforms to speed up environmental licensing, with the administration expected to introduce further license reform by June. Kyriakos Mitsotakis’ government aims to ensure the full licensing process for renewable energy plants takes no longer than two years, in line with European Union guidelines.

The transformative change contemplated flies in the face of a recommendation by the under-fire regulator for minimal amendments to the licensing system, a suggestion made after the RAE conducted its own consultation exercise.