The Energy Regulatory Office issued a communication regarding reference prices. They set the maximum price level for bids submitted by green energy producers in auctions. Therefore, their determination is one of the conditions enabling the regulator to announce auctions for the sale of energy from renewable energy sources in 2020.
Pursuant to the Regulation of the Minister of Climate of April 24, 2020 regarding the reference price of electricity from renewable energy sources in 2020 and the periods for producers who won auctions in 2020, it was announced in the Journal of Laws on May 4, 2020 (item 798) and comes into force on May 19 this year. It sets the maximum prices at which, under the auctions to be carried out in 2020, generators will be able to sell electricity from renewable sources, as well as the support period to which the winners of these auctions will be entitled – 15 years.
Reference prices for wind and sun slightly lower than last year. Other technologies can count on higher prices. As emphasized by the President of the Energy Regulatory Office, summarizing last year’s auctions, nearly half of the energy to be contracted was sold (49% of the volume), and its value was 30%. the total amount foreseen by the legislator to support renewable energy sources.
This proportion means that the energy contracted as a result of the auction in 2019 was cheaper than expected by the legislator. It also shows that the auction system is an instrument whose effects translate into the implementation of real manufacturing infrastructure at the lowest possible cost – Rafał Gawin, President of the Energy Regulatory Office.
Pursuant to the regulation, the maximum support for wind farms with a capacity greater than 1 MW will amount to PLN 250 / MWh this year (by PLN 35 / MWh less than a year earlier). The rate for photovoltaic installations will be no more than 360 PLN / MWh for smaller units (not larger than 1 MW) and 340 PLN / MWh for those with installed capacity greater than 1 MW (in both cases it is 25 PLN / MWh less than in 2019). It is worth recalling that last year’s auction dedicated to new, large (with more than 1 MW electrical installed capacity) installations using wind and solar energy, the cheapest energy was sold for almost 163 PLN / MWh, and the most expensive for 233 PLN / MWh.
This year’s increase in maximum prices is foreseen for:
- Installations generating energy in high-efficiency cogeneration and using exclusively agricultural biogas with an installed capacity of less than 0.5 MW (from 700 PLN / MWh to 760 PLN / MWh), with an installed capacity of not less than 0.5 MW and an installed capacity of not more than 1 MW (from 670 PLN / MWh to 700 PLN / MWh) and more than 1 MW (from 640 PLN / MWh to 670 PLN / MWh);
- Installations generating energy in high-efficiency cogeneration and using biogas from sewage treatment plants with an installed capacity of less than 0.5 MW (from 480 PLN / MWh to 510 PLN / MWh) and with an installed capacity of not less than 0.5 MW (from 445 PLN / MWh up to 475 PLN / MWh);
- Hydroelectric power plants with installed capacity of less than 0.5 MW (from 550 PLN / MWh to 620 PLN / MWh), with installed capacity of not less than 0.5 MW and not more than 1 MW (from 500 PLN / MWh to 560 PLN / MWh) and with an installed capacity greater than 1 MW (from 480 PLN / MWh to 535 PLN / MWh);
- Biomass installations or hybrid systems (from 435 PLN / MWh to 465 PLN / MWh);
- Biomass installations, waste thermal conversion installations or hybrid systems generating energy in high-efficiency cogeneration with an installed capacity of not more than 50 MW (from 470 PLN / MWh to 490 PLN / MWh) and with an installed capacity of more than 50 MW (from 435 / MWh to 465 PLN / MWh).
This year’s sales have been planned in eight auction baskets. The Regulation of the Council of Ministers of December 2019 on the maximum amount and value of electricity specified that the total volume of energy intended for sale in auctions in 2020 will amount to 75.3 TWh, and its value – PLN 27.4 billion, of which a significant proportion – respectively 61 percent volume and 51 percent values - falls on the so-called basket for wind and solar installations above 1 MW (over 46 TWh worth PLN 14 billion). This means that this year’s auctions may generate a total of over 2.4 GW of new RES capacities.
To announce this year’s auctions, apart from the relevant executive acts to the RES Act, a modification of the Internet Auction Platform is also needed. We want the auctions to be conducted using the Platform, which as a tool works very well when conducting and resolving auctions. At the end of April this year we announced a tender for the development of this system. This was necessary due to, inter alia, changes in the law. The opening of tenders will take place on June 1, and the completion of the first stage of works and the adaptation of the Platform to current legal requirements should be completed by September 21. – explains President of the Energy Regulatory Office Rafał Gawin.
Pursuant to the Act on renewable energy, before announcing the auction, the President of the Energy Regulatory Office submits to the minister competent for energy, for agreement, a draft schedule of conducting the auction in a given calendar year, which includes planned dates of conducting the auction and the quantity and value of energy offered in individual auctions. After agreeing the date, the President of the Energy Regulatory Office announces the auctions no later than 30 days before their planned date.
In parallel with the technical activities related to the adjustment of IPA, it will be necessary to agree on the auction schedule with the Minister of Climate. Given our experience to date, the last quarter of the year seems to be the likely date for this year’s auctions. Such a schedule is also postulated by associations of industries most active in auctions – estimates Rafał Gawin, President of the Energy Regulatory Office.