The draft act establishing a new regime for renewable energy
sources (RES) is still being processed by Parliament (for further details
please see "Anticipated
changes to RES support system"). On July 22 2014 the first reading of
the act took place and the draft was passed to the relevant parliamentary
committee for further discussion. On September 15 2014 a public hearing on the
act was held. On October 9 2014 the Ministry of the Economy submitted to the
parliamentary committee a set of additional proposed amendments.
One of the key changes proposed by the ministry concerns the
introduction in the Energy Law – a separate bill – of an additional requirement
concerning grid connection agreements. A grid connection agreement relating to
a renewable energy source would be required to set forth a period following the
date of execution of the agreement within which electricity should be fed into
the grid. This period could be no longer than 48 months, except for offshore
wind farms, in which case the maximum period could not exceed 72 months.
Failure to meet this deadline would result in termination of the agreement. In
relation to grid connection agreements executed before the date of the act's
entry into force, the parties would be obliged to amend the agreement within
six months of the act's effective date and set the deadline for the first
export of power to the grid. Failure to do so would also result in the
termination of the agreement. The respective maximum deadlines of 48 months for
all RES installations other than offshore wind and 72 months for offshore wind
also apply to the existing agreements.
The proposed amendments are intended to allow grid operators
to terminate latent connection contracts. Grid operators and the wind energy
industry have raised the concern that a large number of wind power projects are
not being realised at all or are severely delayed. However, because their
connection contracts set either no deadlines for the commissioning of wind
power plants or very long deadlines, such projects obstruct access to the grid
for other projects which might be realised in a timely manner.
However, it appears that this proposal has not been
harmonised with other provisions of the proposed act. The act would introduce a
support scheme for new RES installations in the form of a feed-in tariff (FiT)
(for small installations up to 500 kilowatts (kW)) or a feed-in premium (FiP)
(for installations of capacity of 500 kW and above) awarded in auctions.
On the other hand, a separate provision of the act states
that a RES developer which has won an auction must construct its RES plant and
start delivering electricity within 48 months – with two exceptions: 24 months
in the case of photovoltaic plants and 72 months in the case of offshore wind
farms – from the date of completion of the relevant auction. However, if the
additional amendments regarding connection agreements are adopted, the deadline
for commissioning the RES installation will be shorter, as it will be driven by
the grid connection agreement (which will be executed before the auction and
may set deadlines shorter than the respective 48 or 72 months) rather than by
the draft act. Although the auction pre-qualification criteria might be
satisfied by holding just grid connection conditions issued by the grid
operator rather than the final grid connection agreement, developers are not
expected to participate in auctions until they hold final grid connection
agreements because, if a developer is successful at auction but subsequently
fails to deliver the project on time, it would be disqualified from subsequent
auctions. Therefore, developers will seek to be certain of their ability to
deliver the project before they participate in an auction.
Changes relating to green certificates system
Mandatory purchase of electricity by "obliged suppliers"
Projects which will continue to be supported by the green certificates system
under the RES Act (ie, those which are commissioned before January 1 2016) will
benefit from the obligation imposed on 'obliged suppliers' (ie, electricity
providers with the biggest volume of sales within the area serviced by the
given local electricity grid operator) to purchase all electricity offered to
such a provider by the owner of the RES installation. The mandatory purchase of
electricity is carried out at the average wholesale market price from the
previous calendar year, calculated and published by the president of the ERO by
March 31 of each year.
The Ministry of the Economy has proposed that the price
would be the average wholesale market price from the previous calendar quarter
and would be calculated and published every three months. As a result, the
price would better reflect current market trends. This solution has been
lobbied for by large power utilities who would perform the role of the 'obliged
suppliers'.
Green certificates redemption date
The Ministry of the Economy has also proposed changing the date by which the
entities obliged to purchase and redeem green certificates must submit
certificates to the president of ERO. The deadline is March 31, both under the
current regulations and in the original version of the draft act; it is now
proposed that the deadline be extended to June 30 each year.
Green certificate quotas
The current version of the draft act provides for a 20% quota in relation to
the obligation to redeem green certificates. However, the minister of the
economy will have the right to set a lower quota in one regulation for one or
several years. The Ministry of the Economy has proposed that the quota for 2015
be equal to 14% and 15% for 2016. These are the same levels as those set for
2015 and 2016 under the applicable RES support scheme.
Changes to FiTs and FiPs awarded in auctions
Reference prices (maximum bid prices) in auctions for the existing projects
In relation to the proposed system of FiTs and FiPs awarded in auctions, the
Ministry of the Economy has also proposed certain modifications to the
calculation formula of 'reference prices' (ie, maximum bid prices) for existing
RES installations to be determined annually by the minister of the economy.
Reference prices would be set taking into account:
the ERO price calculated for the quarter preceding the one
in which the reference prices are announced (instead of the ERO price
calculated for the previous year); and
PLN239.83 per megawatt hour, which according to the proposed
amendment to the draft act constitutes the average price of green certificates
between 2011 and 2013, both in the case of transactions entered into on
commodity exchanges and on the over-the-counter market. The current version of
the draft act only mentions that such amount should be equal to the average
price of green certificates between 2011 and 2013, both in the case of
transactions entered into on commodity exchanges and on the over-the-counter
market but does not explicitly specify such amount.
The Ministry of the Economy has proposed that:
the first auction would be announced by the president of the
ERO within 90 days the date when Chapter 4 (setting forth the new RES support
mechanisms) of the act enters into force – January 1 2016.
the provisions concerning the pre-qualification procedure
should enter into force from July 1 2015. Therefore, from this date entities
developing new projects interested in participating in auctions will be allowed
to participate the pre-qualification procedure to be conducted by the president
of the ERO.
In order to become part of the draft act, these proposals
must be accepted by the parliamentary committee and recommended to the lower
chamber of parliament to be introduced in the revised version of the act.
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