New Law on "Promotion of the use of energy from renewable sources"

On 14 April 2023, the Albanian Parliament adopted the Law no. 24/2023 on "Promotion of the use of energy from renewable sources" (the "Law"). The Law was published in the official gazette no. 64, dated 14 April 2023 and has entered into force on 29 April 2023.

The Law substitutes and repeals the existing Law no. 7/2017 having the same scope. The secondary legislation approved under the previous act will however remain into effect until new secondary legislation is approved on the basis of the Law no. 24/2023.

Below is a summary of the main provisions of the new Law.

The Law, which partially approximated with EU acquis (Directive of 2018/2001 (RED II), aims to promote and incentivize the sustainable producing and the use of energy from renewable sources as part of the national policies on diversification of energy sources and the security of energy supply in the Republic of Albania. 

The Law determines the national objectives for the use of energy from renewable sources and the measures for meeting them. According to the Law, the national objective for the consumption of energy from renewable sources as at 2030 is to reach 54.4% of the overall gross energy consumption.

The Law presents a new concept of “Self-producers of renewable energy”. Self-producers of renewable energy can be any SME (small and medium enterprises) or household consumer who is eligible to install a total capacity of up to 500 kW for the production for self-consumption, as well as to inject and sell the excess energy produced into the distribution network. For this purpose they have the obligation to install a two-way meter at their own expense that will serve to measure the net balance of the energy.

Furthermore, the Law determines the functions and competences of state authorities as well as of other public and private entities in relation to the rules of organization and operation of the market of the energy from renewable sources.

One of the key actors will be the Renewable Energy Operator (REO), which will play the role of the contracting party with the producers of energy from renewable sources eligible for support in one of the forms provided by the Law. The REO will buy the electricity from the producers of energy from renewable sources and will distribute this energy directly to the organized market.

The REO’s main responsibilities will be maintenance of a public online registry of producers of energy from renewable sources eligible for support, management of the renewable sources support fund which will mainly be used for cover of the costs of support schemes, calculation and systematic updating of the renewable resources support fund, keeping detailed records of all measures of the Support Scheme, etc.

The Law provides for the organization of the Renewable energy community as a legal entity, which is entitled to:

• to produce, consume, store, distribute, sell renewable energy and offer aggregation, including power purchase agreements; 
• have access to all appropriate energy markets, directly or through aggregation, in non-discriminatory manner; 
• be supported as a producer with a priority in accordance with the Law.

The renewable energy communities’ members can be:

• any family in need or with low income;  
• any private entity, as long as its membership does not represent its main commercial or professional activity; 
• any household consumer and final consumer.