The Republic of Moldova has a vast potential for renewable energy - one of the largest in the region, being ready to play an important role in addressing energy challenges both nationally and internationally.
Key Facts:
- Technical potential of RES: 65,029 GWh
- Load in the system: Approximately 865 MW Maximum
- Medium tariff for electricity: 91.5 EUR/MWh for end users at 0.4 kv
- Annual average load in the electricity system: 500 MW
- Sunshine: 1950-2210 hours/year
- Percentage of 'green' energy consumed in 2019 in the Republic of Moldova: 26.8%
A conventional energy infrastructure comprises
electricity-generating power plants, along with transmission
and distribution systems that serve various
consumers, including households, businesses, and
industries.
In such setups, energy traditionally moves in a one-way direction
from the producer to the consumer, who remains unaware of the
processes beyond their electrical outlets. This system
operates on alternative energies that cannot be stored in large
quantities, necessitating a continuous match between energy
production and consumption.
However, advancements in renewable energy and digital technologies have empowered consumers to increasingly produce their own energy, particularly through solar power. This shift introduces complexity in managing energy production due to the variable nature of renewable sources, which depend on weather conditions like sunlight and wind.
The energy ecosystem encompasses generators from thermal and nuclear sources, fluctuating renewable energies, and intermittent gas supplies, alongside transportation, distribution, consumer and prosumer engagement, and energy storage solutions.
In the context of the Republic of Moldova, around 4 million MWh
of electricity is consumed annually, with households
accounting for nearly 45% and industrial usage for 15%. This
leads to peak demands of approximately 700 MW during morning
and evening hours, dropping to 180 MW at night.
Consequently, Moldova's ability to integrate wind and solar
energy is constrained by its minimum nighttime and maximum
daytime consumption levels, respectively. Excess green energy
production over consumption can result in energy being transferred
to Romanian or Ukrainian networks, potentially at a cost or
for free, depending on the circumstances. Conversely,
shortages in energy production necessitate costly imports from
neighboring countries.
With an increased reliance on renewable sources, the demand for
traditional energy decreases, leading to a drop in market
prices for conventional energy. However, during high
consumption periods with insufficient renewable energy, prices soar
due to the need for balancing energy from costlier
sources.
The emphasis on balancing the energy system has shifted from solely
relying on power plants to also managing consumer and prosumer
behavior. Effective consumption management and energy storage
can facilitate greater integration of renewable energy into
the grid. On June 1, 2022, Moldova adopted European market
regulations for energy balancing to address unplanned
production and consumption fluctuations,
primarily compensating through expensive, unplanned energy
exchanges with neighboring countries.
Moldova's renewable energy law, supported by the Energy Community and the European Union, introduces mechanisms such as net metering and net billing for photovoltaic (PV) system users, aiming for a fairer system where prosumers are compensated appropriately for the energy they contribute to and consume from the grid.
The Republic of Moldova offers support mechanisms for green energy production, including net metering transitioning to net billing, feed-in tariffs, and fixed-price contracts through auctions for larger energy capacities. Despite consumption structure limitations, Moldova aims to increase its renewable energy share to 30% by 2030, with a strategic focus on reducing greenhouse gas emissions and contributing to global warming mitigation.
Top reasons to invest in Moldova RES:
- Guaranteed Feed-in Tariffs (FiTs) for smaller projects and transparent competitive bidding procedure for bigger ones. FiTs are calculated based on weighted average cost of capital of 8.3%.
- Fiscal incentives for investments in generation of electricity from Renewable Energy. Under power purchasing guarantees the investor is protected against any commercial risks.
- Electricity generated by solar-PV installations, wind turbines, biogas fired power plants and biomass power plants delivered in the electric network by eligible producers will be purchased obligatory by the central electricity supplier.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.