The new Law of Micro-Geraçáo

(DL 363/2007 of 2 of November)

The increasing global environment awareness and the external energy dependence, led on behalf of the Government, to the creation of a new Law of Micro-Generation of Energy with simplified regulations. This Law has been passed to stimulate the general public to invest in Renewable Energies (sun, wind, water, co-generation of heat and power), allowing the micro production of electricity by systems with the maximum power of 3,68/5,75 kW (incentive scheme / general remuneration).

Any consumer, who has a contract with EDP (or any other local power supply company) to purchase low tension electricity may become a micro-producer, which means he may sell the excess or the total amount of energy produced to the local power supply company, being able to gain the incentives provided by the Law.

Under ideal conditions, all electricity sold under these regulations, will be remunerated at a rate approximately 6 times higher than that paid for electricity from the Mains. The cost of electricity from the Mains is approximately 0.11 €/kWh. You may sell the total amount of self produced energy for 0,65 €/kWh, which leads to a payback period of ca. 7 years only. After de first 2.700 registered installation of micro-production, there will be a decrease of 5% of the 0,65 € (these 2.700 installations correspond approximately to the first year’s limit of 10 MW of installations registered nationwide. This limit will increase annually by 20%). The closed contracts will be of 5 years, and then another 10 years. For the first 5 years, the producer will receive 0,65 € for each kWh of photovoltaic production; in the following 10 years, the value of remuneration will be affixed every first of January. After 15 years, the prices for purchase and sale of electricity will be the same for the rest of the lifetime of the installation.

To take part in this incentive program, the micro-production system must be located at the place of consumption, and the maximum power generation must not exceed 50% of the contracted power rating, and must not be greater than 3,68kW to receive the bonus rate of 0,65 €/kWh. It is also mandatory to have a thermal collector installed (for domestic hot water) with a minimum surface of 2 m2.

To obtain the micro-production licence you have to perform an online registration at the SRM data base, the so-called Micro-Production System Registration (Sistema de Registo de Micro-Produçáo), and pay a fee 250 EUR + 12% IVA. In the next 120 days, the micro-production system must be installed, and a preliminary operating license through SRM is to be obtained. An inspection must be performed within 20 days. If everything is in order, the inspector will deliver an inspection report that will substitute the preliminary operating license.

Within 5 working days, a purchase and sale contract will be sent to you. Then, SRM will ask the power supply company to connect your micro-production unit to the public net, within 10 working days.

Your electricity account will be processed by the distribution operator, and there is no need for a written agreement for individual producers that don't have organized accounting (according to the terms from IVA code no. 11, of article 35. of the added value tax code - IVA). All payments from and to the power supply company will be executed through bank transfer on the same monthly or yearly basis.

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