Directorate NOTE regarding the approval by the Shareholders’ General Assembly of ”The 10-year development plan of the power transmission grid (RET) (2018 – 2027)” I. Generalities ”The Development Plan for the Power Transmission Grid 2018-2027" (hereinafter referred to as PDRET) was drawn up by the National Power Grid Company Transelectrica SA in accordance with article 35 para. (1) and para. (2) of the Law on Power and Natural Gas 123/2012, with later amendments and additions, according to which ”the transmission system operator must prepare 10-year investment and development plans of the power transmission grid, in accordance with the current state and the future evolution of power consumption and the sources, including power import and export”. II. Justification According to the competences and attributions established by the Law on Power and Natural Gas 123/2012, with later amendments and additions, the RET Technical Code and the Conditions attached to License 161 for Power Transmission and System Service Provision, the National Power Grid Company Transelectrica SA carries out the planning activity on the development of the Power Transmission Grid (RET). In this regard, the National Power Grid Company Transelectrica SA draws up every two years a RET Development Plan for the following 10 successive years, a document that is subject to the approval of the decision-makers. The Development Plan is a comprehensive presentation of the aspects related to the functioning of the power transmission grid, integrated in the context of the National Power System and the power market, intended for power market customers, regulatory bodies and decision-makers in the power sector. The paper includes information on the power generation and consumption sectors, the characteristics and performance of the power transmission grid, and other useful information to assess existing or potential market opportunities. The content of the PDRET, the conditions and principles for its elaboration, the source and structure of the data used and the criteria applied in the elaboration of the plan are in accordance with the provisions of Chapter IV of the Technical Code of the power transmission grid, approved by ANRE Order 20/2004, with later amendments and additions , and with the principles established by ENTSO-E for the elaboration of the community-level development plan TYNDP - Ten Year Network Development Plan. Also, the elaboration of the RET Development Plan every two years is in line with the National Power Grid Company Transelectrica SA’s obligation to participate, as a member of the ENTSO-E European transmission system operators’ association, by drawing up the document Ten Year Network Development Plan (TYNDP). Provisions of art. 8 para. (10) of Regulation (CE) (EC) 714/2009 regard this aspect. They are provisions on conditions for access to the grid for cross-border power exchanges (Regulation 714/2009), which provide that ENTSO-E adopts and publishes, every two years, a community-level grid development plan, which includes the modelling of the integrated grid, a development scenario, an European assessment of production capability adequacy and an assessment of system flexibility, based on national investment plans, taking into account regional investment plans. On 04.04.2018, through address 11429, the National Power Grid Company Transelectrica SA has submitted PDRET to the Romanian Energy Regulatory Authority (ANRE) for approval. Subsequently, ANRE approved PDRET by Decision 1604/05.10.2018, issued in accordance with the provisions of art. 35 para. (3) of the Law on Power and Natural Gas 123/2012, with later amendments and additions, and in accordance with the provisions of art. 5 para. (1) letter d) and art. 9 para. (1) letter v) from Emergency Ordinance 33/2007 on the organization and functioning of ANRE, approved with amendments and additions by Law 160/2012, with later amendments and additions, with certain obligations for the Company, as set out in the annex. Article 2 of ANRE Decision 1604/2018 stipulates the following: ”Within 90 days of the communication of this decision, the National Power Grid Company Transelectrica SA shall send to ANRE the decision of the Shareholders’ General Assembly approving the Development Plan provided for in art. 1”. III. Proposals In view of the above, in accordance with art. 2 of the ANRE Decision 1604/05.10.2018, as well as art. 14, para. 2, letter n) of the Articles of association, we propose the following to the Shareholders’ General Assembly: - approval of the ”Development Plan of the power transmission grid 2018-2027”. Directorate, Chairman, Adrian - Constantin RUSU Members, Andreea Georgiana Adrian-Mircea Viorel Constantin FLOREA TEODORESCU VASIU SARAGEA 2/3 Visas: UMA Director Gheorghe ȘTIRBU DEMDRET Director Ștefan ȚIBULIAC DDRET Manager Daniela BOLBORICI DGCRIR Director Bogdan Toncescu DJC Director Radu Cernov 3/3 PTG Development Plan for 2018 – 2027 1 Responsible for the works: Oana Raluca Mânicuță Electricity grids expert Opinion no. 30/2018 of TESC Transelectrica Approved, Directorate: Chairman Member Member Member Member Adrian Constantin Constantin Viorel Adrian Mircea Andreea Georgiana RUSU SARAGEA VASIU TEODORESCU FLOREA 2 Table of Contents Annexes _______________________________________________________________________ 6 Abbreviations ___________________________________________________________________ 7 1. Purpose and objectives of the Ten-year PTG development plan _________________________ 9 2. European integration of the power transmission grid planning ________________________ 10 2.1. Correlating the European Ten-Year Network Development Plan (TYNDP) with the National ten- year power transmission grid development plan ___________________________________________ 10 2.2. Priorities in the energy infrastructure sector ante and post 2020 – Projects of Common Interest (PCI) _______________________________________________________________________________ 13 2.3. Overview of the benefits brought by the PTG development projects included in TYNDP 2016 _ 14 3. Legislative and regulatory framework ____________________________________________ 16 3.1. Primary legislation _______________________________________________________________ 16 3.2. Secondary legislation ______________________________________________________________ 20 4. Principles and methodologies used in drafting the PTG development plan _______________ 23 4.1. Principles applied in drafting the PTG development plan _______________________________ 23 4.2. Methodologies/analyses used in drafting the PTG development plan ______________________ 23 5. Analysis of the current situation of PTG and associated infrastructure for the period of 2016- 2017__________________________________________________________________________ 25 5.1. Power generation capacities ________________________________________________________ 25 5.2. System adequacy at peak load ______________________________________________________ 26 5.3. Internal electricity transmission capacities and interconnections with other systems _________ 32 5.4. Loading factor of PTG elements ____________________________________________________ 36 5.4.1. Summer of 2017 ______________________________________________________________________ 36 5.4.2. Winter of 2016-2017 ___________________________________________________________________ 38 5.4.3. Conclusions regarding the domestic grid load _______________________________________________ 40 5.4.3.1. SEP section (summer of 2017) _______________________________________________________ 40 5.4.3.2. WEP section (winter of 2016-2017) ___________________________________________________ 41 5.4.4. The total and bilateral transmission capacities on borders ______________________________________ 41 5.4.4.1. Calculated/estimated net exchange capacities ____________________________________________ 42 5.4.4.2. Maximum net transfer capacities ______________________________________________________ 44 5.4.4.3. Monthly net transfer capacities _______________________________________________________ 46 5.4.4.4. Factors that influence the non-guaranteed maximum capacity values and the annual and monthly fixed exchange capacities ______________________________________________________________________ 46 5.4.4.5. Graphic representation of the influences over the fixed NTC in 2014-2017 _____________________ 48 5.4.4.6. Graphic representation of NTC profiles and exchange programs _____________________________ 51 5.5. The admissible voltage level, voltage control in PTG nodes, reactive power compensation, voltage quality _____________________________________________________________________________ 52 5.6. Power losses in sections specific to the load curve and annual electricity in the PTG _________ 55 5.7. Short-circuit current level in PTG nodes _____________________________________________ 58 5.8. Inspection of PTG under steady-state and transient stability conditions ___________________ 59 5.8.1. Inspection of PTG under steady-state stability conditions ______________________________________ 59 5.8.1.1. Calculation assumptions ____________________________________________________________ 59 5.8.1.2. Results of steady-state stability analyses ________________________________________________ 61 3 5.8.1.3. Analysis of NPS characteristic sections in terms of steady-state stability conditions ______________ 63 5.8.2. Transient stability and potential improvement measures _______________________________________ 64 5.8.2.1. Methodology and calculation assumptions ______________________________________________