Power Purchase Agreements (PPAs) were created to attract investments for the power plants the country needed, but which the State could not or did not want to finance.
The PPAs established that producers who invested in these plants would receive a compensation for their investment and availability and would be compensated for all the costs they would incur during production.
Establishes a new organization model for the energy sector and establishes PPAs as a form of remuneration for the production activity. download
Creates the PPAs and establishes that non-binding generation licenses, as in the case of Sines, have no deadline. It also determines that the water domain usage should be sub-contracted to the binding producers who, in 1995, had acquired rights to use that public good for the purposes of hydroelectric generation.
It also establishes that EDP would receive 1356 million euros of the plant's residual value at the end of those contracts if the plants were delivered to the State.download
Specific steps are now being taken to phase out the PPAs with the community directive that establishes the rules for the operation of the liberalized electricity market.
Decree-Law 184/2003 - Defines the creation of a market liberalization framework (MIBEL). download
Establishes the principles for the early termination of the PPAs. download
Establishes the methodology's general principles and main valuation parameters for the early termination of the PPAs. download
The early termination of the PPAs was decided, which forced the adoption of a compensation mechanism that ensured financial neutrality and which was approved by the European Commission and the Portuguese Parliament - the Costs of Maintenance of Contractual Equilibrium (CMCE).
EDP, which had the State as its largest shareholder, was the only producer that agreed to transit to the new regime.
Defines the method and criteria for the determination of the amount of annual remuneration that the RNT (REN) concessionary entity is entitled to. It also establishes that producers who had terminated the PPAs in advance and had chosen to rent the land, would have the respective costs recognized by the CMCEdownload
ERSE Statement on CMCE's Decree-Law
Analysis by the regulatory authority of the regulations provided in Decree Law 240/2004. download
Approval by the European Commission of the CMCE mechanism, considering them State aid compatible with Community regulations. download
Grants legislative authorization for the Government to define the compensatory measures' conditions for the early termination of the PPAs. download
Approves a new remuneration mechanism, the CMCEs, which ensures financial neutrality in relation to the PPAs. download
The Government approves the agreements for the termination of the PPAs.
Rectification Statements 1-A 2005 and 1-B 2005
Establishes the correction coefficient of the Valorágua model.download
Approves the early termination of CMCE contracts between REN and EDP. download
CMCEs are implemented in accordance to the rules defined in 2004, updating the market parameters - which reduced the value of EDP's remuneration.
In the context of the Public Hydric Domain, EDP abdicates of 1 356 million euros and pays 759 million euros to the State for its extension.
Market parameters' value to be used for the DL 240/2004 application, with the increase of the electricity reference price from €36/MWh to €50/MWh, leading to the reduction of the initial CMCE value to €833M. download
Establishes the rules for the regularization of the PHD utilization licenses and recognizes the existence of the right of use of the PHD by the PPAs plants from the entry into force of DL 183/1995, against payment of an economic-financial balance. download
Approves the addenda to the agreements on the early termination of the PPAs. download
Realizes the value obtained using the DL 240/2004 methodology, setting a nominal rate of 7.55% before taxes (5.47% after taxes) for EDP.download
New legal provisions to regulate the sale of energy due to Turbogás and Tejo Energia not having agreed to extinguish their PPAs in advance. download
ERSE's 2007 Statement on Revisability
Favorable opinion of the regulator on the remuneration to be attributed to EDP in this year.download
Analysis of the regulatory authority to the changes introduced by Decree-Law 199/2007. download
The CMCE suffer a cut of 14 million euros per year, for a total of 120 million euros in NPV for the period between 2013 and 2017.
ERSE's statement on the remuneration rate
Regulator analysis of the reformulation of the CMCE remuneration rate. download
ERSE Statement on the new nominal rate
Regulator analysis of the new nominal rate applicable to the CMCE fixed installment annuity. download
Amends the Decree-Law that created the CMCE in 2004, and reformulates the rates applied to the remuneration, allowing the annuity rate to be modified on EDP's proposal - provided that it is lower than the value set in 2007. download
Approves the new nominal rate applicable to the calculation of the fixed installment of the contract maintenance cost (CMCE) (reduction of the tax rate from 7.55% to 4.72% reducing the initial CMCE value by €120M in NPV). download
Establishes the system for checking the availability of the power plants. download
ERSE's 2013 Statement on Revisability
Favorable opinion of the regulator on the remuneration to be attributed to EDP in that year. download
The European Commission closes the PHD complaint and reinstates the CMCE mechanism. ERSE proposes final CMCE revisability value, for the period between 2017 and 2027
The Government approved the final revisability of the CMCE, and the value has already been contested by EDP. It was also quantified, by governmental order, the alleged overcompensation of EDP regarding the calculation of the coefficient of availability verified in the plants that operated in the CMCE regime. The Parliamentary Commission of Inquiry for the Payment of Excessive Income to Electricity Producers was also started.
The Parliamentary Commission of Inquiry for the Payment of Excessive Income to Electricity Producers is constituted, the hearings are still pending.download
Memorandum on the calculation of alleged overcompensation of CMECs
By governmental order, the alleged overcompensation of EDP was quantified at 285 million euros for the calculation of the coefficient of availability verified in the plants that operated in the CMCE regime. In a statement, EDP considered that said order lacks legal, economic and technical basis.download