The Republic of Moldova has a new law regarding regulatory sandboxes in the production, distribution, or consumption of energy. On 31 July 2024, this legislative initiative was passed in its second reading by the Parliament of the Republic of Moldova.

The new law addresses the emerging need to stimulate innovation in the sector for a just energy transition and sustainable development. To accelerate the innovation process in the energy sector, a special testing regime will be established, with exemptions from certain legislative provisions, including in the fiscal domain. These exemptions will be granted for a period of up to seven years, with the possibility of justified extensions for an additional five years. The shift from fixed frameworks to adaptable regulations will allow companies to test innovative solutions under conditions similar to the real market in the Republic of Moldova, within a safe environment.

“In our commitment to achieve net zero carbon emissions by 2050, current technologies are insufficient. Therefore, there is a need for research and commercial development of new technologies in the energy sector, which is traditionally the main contributor to greenhouse gas emissions. Moldova aspires to attract and host innovative companies that will develop and test future technological solutions right here,” stated Cristina Pereteatcu, State Secretary at the Ministry of Energy.

The law's application domains include:

• flexibility and balancing services for the grid
• electric energy storage
• integration of low-carbon gases into renewable gas networks
• electric mobility
• energy communities
• smart grids
• integration of renewable energy sources
• setting energy tariffs.

The new law will help create the legal conditions for accelerating integration into the EU space and the Energy Community to achieve climate neutrality by 2050. The adoption of this project is validated by the need to achieve Sustainable Development Goal 7 by 2030, which aims to ensure access to affordable, safe, sustainable, and modern energy for all. Additionally, the law aims to attract investments in the sector, and increase the share of renewable energy in final gross consumption to 27% by 2030.

Testing projects falling under the new law will be approved by a Government decision, and their implementation will be supervised by the Commission for Innovative Regulatory Sandboxes in the Energy Sector, under the Government’s authority.

The legislative initiative for regulatory sandboxes in the Energy sector was developed by the Ministry of Energy, with support from UNDP Moldova and funding from Denmark, Luxembourg, the Republic of Korea, and Sweden.

UNDP Moldova will continue to support the institutionalization of innovative regulatory sandboxes and the development of secondary normative acts.

Among the first innovative testing projects within the Sandbox will be the application of differentiated day-night electricity tariffs for a series of residential consumers who will install smart meters, with support from UNDP Moldova and Italy. Another pilot project will be the creation of energy communities, with support from UNDP, Sweden, Norway, and USAID.