WR Energy Update: New requirements for allocation of grid capacity

The Norwegian Ministry of Energy recently introduced new regulations requiring mature projects to be prioritised in the grid capacity queue.
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In recent years, there has been a sharp increase in the demand for grid capacity. A large number of applicants are requesting connection to the electricity grid, but are being placed in capacity queues because the capacity in many areas is fully utilised and the expansion of the grid infrastructure takes time. Effective from 1 January 2025, the Ministry of Energy has established new requirements to prioritise mature projects in the grid capacity queue in the Regulations on Grid Regulation and the Energy Market (Nw: NEM-forskriften). Projects that do not fulfil an agreed progress plan will risk losing their capacity reservation or queue position.
Assessment of maturity
As a starting point, grid operators have an obligation to connect and to ensure market access on objective and non-discriminatory terms. This means that anyone requesting increased capacity or connection to the grid is generally entitled to it under specific terms and conditions, including that the connection must be operationally justifiable. When there is no available capacity in the grid, the applicant must be placed in a queue. Due to an increasing number of applicants requesting access to electricity, the queues to be connected to the grid have lengthened. Several grid operators have already applied maturity requirements for handling capacity reservations and capacity queues to fulfil their obligation to ensure market access pursuant to NEM Section 4-6.
Effective from 1 January 2025, maturity requirements are set out in NEM sections 3-4 and 3-5. These maturity requirements formalise parts of previous practices and aim to ensure equal treatment and predictability for everyone requesting grid capacity. The new requirements mandate grid operators to assess whether the applicant's project is sufficiently mature before allowing it to reserve capacity or a capacity queue position, and make an ongoing assessment of the project's progress in order to retain the reservation or que position. The changes apply both to applicants applying for connection or increased capacity of more than 1 MW, and to projects that have already reserved capacity or secured a position in the capacity queue.
'Project maturity' refers to the likelihood of a project's successful realisation. The assessment of a project's maturity is based on objective and standardised criteria, known as 'maturity criteria'. The primary purpose of maturity assessments is to prioritise projects within the grid queue that are likely to be implemented. By doing so, the assessment aims to ensure a more efficient utilisation of grid capacity, ensuring that available capacity is actually used and preventing unrealisable projects from displacing viable ones.
The responsible grid company for the maturity assessment
For connection applications with a capacity of 1 MW or more, the responsible grid operator must conduct a maturity assessment of the project without undue delay. The responsibility for the maturity assessment depends on the size of the requested capacity:
- 1 MW or more: distribution grid operator
- 10 MW or more: overlying regional grid operator
- 100 MW or more: transmission system operator (Statnett)
The grid operator is the contact point for all connection requests. For requests of more than 10 MW, the maturity assessment is carried out in co-operation between the distribution grid operator and the overlying regional grid company or Statnett, respectively. For requests between 1 MW and 9.9 MW, the grid operator carries out the assessment independently, and this assessment cannot be reviewed or supplemented by the overlying regional grid operator's own assessment.
The grid operator responsible for the maturity assessment must carry out the assessment "without undue delay" and provide feedback to the applicant on whether the maturity criteria have been met. What constitutes "undue delay" is discretionary and may vary. The time period is calculated from the grid operator's receipt of the applicant's documentation on maturity and until the grid operator has sent written feedback on whether or not the criteria for maturity have been complied with.
Criteria of maturity
The new regulatory provision in NEM establishes the following list of minimum criteria for the maturity assessment:
- project description
- actual capacity requirement
- time of utilisation of the capacity
- binding progress plan
- status of relevant permits and agreements
- localisation
- financing plan
The maturity criteria applies to all requests at all network levels. The list of maturity criteria is not exhaustive, and grid operators may impose additional criteria beyond those listed. According to the regulation, all maturity criteria and detailed requirements for compliance must be communicated to grid customers in advance. Any supplementary criteria must comply with the grid operator's duty of neutral behaviour and to ensure market access on non-discriminatory and objective terms, cf. NEM sections 4-6 and 4-14.
Allocation
If the applicant's project is deemed to be mature and other conditions are met, the applicant may reserve capacity or alternatively a place in the grid queue. The decisive date for the reservation or allocation of a place in the queue is the date on which the applicant submitted sufficient documentation.
Withdrawal of reservation or a position in the grid queue
In order to maintain the reservation or a position in the queue, the applicant's project must have sufficient progress. To ensure this, the grid operator is obliged to request additional information in consideration of the maturity criteria. The grid operator is required to withdraw all or part of the reserved capacity or the position in the queue if the conditions for withdrawal are met.
Because significant amount of time may elapse from the initial maturity assessment until the project secures a reserved capacity, changes in the project that affects the need for grid capacity may occur. The requirement for sufficient progress aims to prevent applicants monopolising grid capacity when it is unrealistic for them to use it, or if they have reserved more capacity than needed. In practice, this means that an applicant with reserved capacity or a position in the queue does not have a perpetual right to this reservation.
To withdraw reserved capacity or a position in the grid queue, two cumulative conditions must be met. Firstly, there must be "significant changes or deviations in the fulfilment of the maturity criteria", and secondly, the change or deviation must be due to "circumstances for which the operator is directly or indirectly responsible or must bear the risk". According to the preparatory works, there is a high threshold for withdrawing reserved capacity or a position in the queue, and this threshold increases in proportion to the project's progress.
A decision to withdraw a reservation or queue position must be notified in advance, and the reasons for the withdrawal must be given in writing without undue delay. The requirement for prior notification allows applicants to provide further information before the final decision to withdraw is made.
Projects with existing rights
Successful applicants that have reserved capacity or been allocated a position in the queue before the changes in the regulations came into force on 1 January 2025 must also meet the maturity requirements. In order to retain the reservation or position in the queue, the applicant must submit documentation of maturity within six months upon a request by the grid operator. If the project is deemed mature, the applicant may continue and retain its original reservation or position in the queue. However, if sufficient documentation is not submitted or the project is not considered sufficiently mature, the reservation or place in the queue may be withdrawn.
You are welcome to contact us if you would like more information or advice regarding grid connection. Our experts have extensive experience across the energy sector and are available to assist your business with such as strategic planning, grid capacity application processes, and meeting the new regulatory requirements.