Over-the-counter contracts for energy purchase on the non-interconnected islands (gré à gré)

The CRE intervenes within the framework of a compensation mechanism, to compensate for the additional costs linked to energy purchase contracts on the non-interconnected islands. The method of calculating the compensation depends on the type of contract. In the case of an over-the-counter contract, CRE intervenes in two ways:

1. It proposes to the Minister in charge of energy a rate of remuneration for the electricity installation which will allow compensation via the CSPE,
2. The CRE evaluates ex-ante the normal and complete production cost (CNC) which represents the purchase cost of the electricity.

This system allows the investment to be compensated and remunerated. 

In this respect, article R. 121-28 of the Energy Code provides that "the draft electricity purchase contract [between the third-party producer and the incumbent supplier] shall be communicated to the CRE, together with the elements necessary to assess the compensation [here implied by the acquisition price]. (...) The Energy Regulatory Commission shall assess the normal and full production cost for the type of production facility considered in this zone by applying the rate of return on tied-up capital set, after the opinion of the Energy Regulatory Commission, by order of the Minister in charge of energy pursuant to Article L. 121-7. (...) ". The b) of II of the same article specifies that "(...) the CRE notifies the parties, within two months of receiving the complete file, of the result of its assessment, on the basis of which the compensation is calculated.

In the non-interconnected islands, a significant part of the electricity production assets is developed within the framework of a private contract concluded between the producer and the historical supplier of the zone. In order to provide transparency to project developers, CRE has established a methodology, which it adopted on 23 April 2015 after public consultation, aimed at specifying, in compliance with the legislative and regulatory framework recalled above, the procedures for referral, examination, calculation of the normal and full cost, compensation and, more broadly, the regulation of generation facilities under a direct purchase contract.

Freely decided, can be for the short term (2 years) or longer (up to 30 years).