The Minister of Agriculture launched a public consultation for the Governmental Decision for the amendment and completion of the Methodological Norms for the application of the provisions of the Government Emergency Ordinance no. 34/2013 regarding the organization, administration, and exploitation of permanent pastures and for the amendment and completion of the Land Fund Law no. 18/1991, approved by Government Decision no. 1064/2013, as well as for the establishment of measures for their application (the “Draft GD”).
In brief, as of July 2022, the development of renewable energy sources (“RES Projects”) up to 50 hectares on the extra muros agricultural land plots1 having IIIrd-Vth soil quality has been allowed in the extra muros area subject to the following: (i) the approval for removal from the agricultural use and (ii) the building permit. While in case of (i) pastures and permanent grasslands, (ii) vineyards and orchards and (iii) land plots with land improvement infrastructure, the dual system has been allowed, the arable lands have been excluded from such application.
As per the Draft GD the use of permanent grasslands in a dual use system means conducting both grazing and fodder production activities, as well as electricity production from renewable sources, on the same area of permanent grassland, so as not to affect the proper exploitation of the grasslands (“Dual Use System”).
Further on, the Draft GD provides the definition of the proper exploitation of grasslands in the case of Dual Use System (the “Proper Exploitation of Grasslands”) as the predominant use of permanent grassland areas for agricultural activities, depending on the animals from bovine, ovine, caprine, and equine species. Specific objectives for producing electricity from renewable sources can be placed on these areas, provided that they do not affect the production of grass and other cultivated or spontaneous herbaceous forage plants, the nutritional value of the area on which the agricultural activity is carried out, the grazing capacity, or the measures for managing permanent grasslands established by pastoral arrangements or grazing regulations throughout the duration of these investment objectives. The height of the specific objectives for producing electricity from renewable sources and the distance between rows should ensure the movement, physical safety, and shelter of the animals.
In practice, since July 2022, implementing Dual Use System due to the lack of a cap on the area that can be used for renewable energy production, as well as due to the lack of ways to implement this business. Investors in energy do not usually perform agricultural activities, and vice versa. There has been no clear delineation of the area or a defined implementation process, creating uncertainty and operational challenges.
Now, the intention is to clarify and amend the legal provisions applicable in the case of dual use of permanent grasslands for both grazing and renewable energy production without compromising their agricultural productivity, providing clarificatory guidelines and inter alia, capping Dual Use area to 10 ha out of 50 ha per RES Project on permanent grassland.
1 By means of agricultural land plots, the Law No. 254/2022 envisages the following (i) arable lands, (ii) pastures and permanent grasslands, (iii) vineyards and orchards and (iv) land plots with land improvement infrastructure
A. SINGLE VS MULTIPLE HOLDERS IMPLEMENTATION OF DUAL USE SYSTEMS ON PERMANENT GRASSLANDS
As per the Draft GD, when permanent grasslands are used in a Dual Use System, the two activities can be conducted as follows: either (i) by a single holder for both agricultural activities and the production of electricity from renewable sources or (ii) by two holders: one for agricultural activities and the other for the production of electricity from renewable sources. In this case, a legal deed for the use of the land area will be concluded if one of the holders is the owner of the grassland area, or two legal documents regarding the use of these areas for each of the activities.
B. APPROVAL OF LIVESTOCK BREEDERS’ ASSOCIATIONS FOR DUAL-USE ON PUBLIC OR PRIVATELY OWNED GRASSLANDS
As per the Draft GD, for grasslands in the public/private domain of the state, administered by the National Forest Administration-Romsilva, and in the public/private domain of communes, towns, cities, and Bucharest, contracts for dual-use can only be concluded with the approval of livestock breeders or their associations. This approval is required under the condition that the reduction of the grassland area due to the placement of investment objectives does not negatively impact the proper agricultural exploitation of the grasslands, grazing capacity, and access to the agricultural area of the grasslands.
C. MAXIMUM 10 HA OF 50 HECTARES/RES PROJECT USED IN A DUAL SYSTEM IN CASE OF PERMANENT GRASSLAND
The Draft GD specifies the procedure for partially removing land from agricultural use for renewable energy projects, ensuring continued agricultural activities on the remaining land. The remaining grassland area stays in agricultural use and is utilized for agricultural activities. The area proposed for removal from agricultural use must be documented at the level of each plot or parcel within a hectare, both in written documents and topographical plans.
The area occupied by these objectives must not exceed 20% of the total area of 50 hectares per RES Project used in the Dual Use System.
Moreover, the following provisions shall apply should the Draft GD enter into force: RES Projects are only placed on areas approved for removal from agricultural use. Occupying other areas used for agricultural activities in the Dual Use System is prohibited. For any changes to these areas that increase the area occupied by RES Project, approval for removal from agricultural use must be obtained.
This is an important aspect because non-compliance with this requirement may hinder the process of reception upon the termination of the construction works, Land Book registration of the RES Project (as a construction), and thus delay the commercial operating date.
D. OBLIGATIONS AND COMPLIANCE FOR DUAL-USE SYSTEMS ON GRASSLANDS
D.1. The obligation to maintain the use of grasslands in a Dual Use System
As per the Draft GD, to maintain the use of grasslands in a Dual Use System, the beneficiary of the RES Project must ensure that, throughout its operational period, the remaining agricultural area will be used for the works specified in the pastoral arrangements and for specific agricultural activities related to grasslands, such as grazing and/or fodder production.
The county Agricultural Directorates (in Romanian: Direcțiile pentru agricultură județene) are responsible for verifying compliance. They conduct yearly inspections throughout the existence of RES Project, starting from the date of the decision approving the removal from agricultural use with the dual-use mention. They check whether the conditions for dual use are being met and complete a verification report, which is also signed by the holder(s) of the grasslands.
D.2. The obligation to recover an equal area of unproductive land
The beneficiary of permanently removed extra muros grassland areas from agricultural use must recover an equal area of unproductive land. This recovery must be completed by the date specified in the removal approval to ensure no net loss of grassland area locally, county-wide, or nationally.
If no unproductive lands are available within the original administrative unit, recovery can occur in other units within the same county, with their agreement.
Upon completing the recovery, the beneficiary must:
- Introduce the recovered land into agricultural use as permanent grasslands;
- Ensure a verification report by county agricultural directorates;
- Conduct a pedological and agrochemical study to confirm land quality;
E. PUBLIC CONSULTATION
This Draft GD is open for public consultation. Interested stakekeholders are invited to submit written opinions, proposals, and suggestions within 10 days from 18th July 2024.
Submissions should be sent to the following email addresses: romeo.dragomir@madr.ro and anne.niculescu@madr.ro.