Meet The Law -DGEG’s Order – Admission Contract Draft – Electricity Intensive Customer Status

On May 13 it was published in the Portuguese Official Gazette the Order no. 5975-B/2022, of the Directorate-General for Energy and Geology (DGEG), which approves the admission contract draft to obtain the Electricity Intensive Customer Status. This status is regulated by articles 192 to 195 of Decree-Law no. 15/2022, of January 14, and establishes a set of obligations and support measures aimed at ensuring that facilities benefiting from it (i.e., the facilities that meet the requirements of article 194 of Decree-Law no. 15/2022) enjoy fairer competition conditions when compared with similar facilities operating in other European Union Member States. These electricity intensive customers benefit from a reduction in electricity prices and have access to energy at more competitive conditions.

Pursuant to article 193(4) of Decree-Law no. 15/2022 the draft contract shall be made available to the applicant of the request to obtain the Electricity Intensive Customer Status, once compliance with the eligibility conditions set out in Ministerial Order no. 112/2022, of March 14, which regulates the Electricity Intensive Customer Status, has been verified.

Customer facilities wishing to obtain the Electricity Intensive Customer Status shall send to DGEG by June 15 of each year, the necessary supporting documentation referred to in the annex of the aforementioned Ministerial Order. 

Decree-Law no. 33/2022 - Exceptional and temporary mechanism for adjusting electricity generation costs within the MIBEL

On May 14, Decree-Law No. 33/2022 was published in the Portuguese Official Gazette, establishing an exceptional and temporary mechanism for the adjustment of electricity generation costs within the Iberian Electricity Market (MIBEL).

The recent increase in fuel prices caused by the war in Ukraine and the resulting instability in the energy sector led to the creation of an exceptional and temporary price-setting mechanism in the MIBEL.

This mechanism provides for the fixing of a reference price for the natural gas used in the production of electricity traded within the Iberian market, aiming at reducing electricity prices.

For this purpose, an adjustment mechanism of the electricity production costs will be calculated and applied, and the costs resulting from said compensation will be charged on the electricity demand in the wholesale market, after deducting the volumes of energy traded that is associated to fixed price contracts. These contracts must be identified and reported by the entities operating within MIBEL. The report of the contracts mentioned in paragraphs 2 and 3 of article 7 must be submitted by Friday, May 20, in conformity with the models approved by Directive no. 11/2022, of May 14th.

These provisions shall be applicable until May 31, 2023.

Directive no. 11/2022 - Reporting obligations related to the cost adjustment mechanism in the MIBEL

On May 14, Directive no. 11/2022 was published in the Portuguese Official Gazette, approving the reporting obligations related to the cost adjustment mechanism for the Iberian Electricity Market (MIBEL) created by Decree-Law no. 33/2022, of May 14.

This directive publishes the tables to be used for the reporting of the fixed price contracting instruments covered by the exemption provided for in article 7 of Decree-Law no. 33/2022, of May 14.