After more than three years’ work, the Act on RES came into force on 4 May 2015. The new rules on the support scheme for renewables provided in the new Act on renewable energy sources (“Act on RES”) are due to come into force on 1 January 2016 .
- RES installations that commenced generating electricity before the new support scheme entered into force will have the choice of staying in a system substantially the same as the current one.
- Planned RES installations, which commenced generation after the new support scheme entered into force, will not be eligible for green certificates and will only be able to participate in the auction system.
- The new support scheme generally provides for fixed time frames for RES installations that are eligible for green certificates. The RES Act will grant green certificates for 15 years following the introduction of the first volumes of energy for which green certificates were obtained by a given RES installation, but only until 31 December 2035. The 15-year period will be calculated from the first electricity delivered to the grid from a given facility.
- Auctions will be held separately for existing facilities entitled to the green certificate scheme, which may choose to benefit from the auction scheme instead, and pre-qualified installations that will generate electricity for the first time after 1 January 2016.
- A pre-approval process, conducted by the regulator in order to evaluate their readiness to generate energy for auction purposes, is being introduced.
- The bid volumes and prices will be determined by the bidders; however, the bid price may not exceed the applicable reference price.
- The Act on RES does not say how energy generated prior to 1 January 2016 should qualify for green certificates, i.e. whether such support should cover only turbines that generated energy prior 1 January 2016 or an entire installation (the total number of turbines), even if only one turbine commences generating energy before chapter 4 of the Act on RES enters into force. As the definition of an installation refers to set of devices producing energy, it is questionable whether the final number of turbines as a whole will be entitled to green certificates or only devices that produced energy prior to 1 January 2016 may receive green certificates.
Microinstallations and other issues
- Microinstallations are generators of renewable energy with no more than 40kW of total installed electrical capacity, connected to an electrical grid of a voltage lower than 110kV or no more than 120 kW of total installed heat capacity.
- The process of setting up a microinstallation is being simplified in a number of ways.
- Applications to connect a microinstallation to an energy distribution company’s grid will no longer be subject to a connection fee nor required to attach documents confirming the admissibility of locating the installation in the investment area.
- Selling energy generated by a microinstallation will not be regarded as a business activity if it is conducted by an individual who is not running a business.
- The Act on RES introduces the concept of obliged supplier, taking over the function of last resort supplier under the current scheme. Obliged suppliers will be nominated by the President of the Energy Regulatory Office for each calendar year from among the entities that supplied the highest volume of electricity to end-users connected to the grid of a given grid operator.
- From 2015, renewable generators have been granted priority in connection to the grid. The grid connection agreement for a renewable energy generator has to determine the date of commencement of delivery of electricity to the grid, which may not be longer than 48 months after the date of the agreement. In the event that the grid operator has no available capacity for a renewable energy generator by the date requested by the applying prospective generator, the operator is in each case obliged to specify the planned date and conditions of the necessary grid upgrade(s) and/or extension(s).
- Other amendments include changes to the provisions on suspending energy supplies, changes in various regulations regarding renewable energy generators, and new regulations on training courses, certification of installation engineers for microinstallations and small installations, international cooperation on investment projects and cooperation in the field of renewable energy.
Proposed modifications to the RES Act
- Despite the short time since the Act on RES was adopted, the Ministry of Economy has prepared a proposal for some modifications to the support for smaller installations provided by the Act on RES. The regulation sets out that investors who will not be able to complete their investment by the end of 2015 and would like to sell energy before the first auction takes place, may sell all the energy they produce on the energy exchange or on the regulated market but not later than to 31 December 2016.
- Smaller installations may not benefit from both feed-in-tariffs and investment aid programmes at the same time.
- A minimum price will be introduced for the purchase of energy in microinstallations with a total installed capacity up to 3 kW: hydroelectric – PLN 0.75 per kWh, onshore wind – PLN 0.75 per kWh, photovoltaic – PLN 0.64-0.75 per kWh.
Questions and controversies
- Concerns regarding the qualification for green certificates support scheme are widely discussed. The definition of a “renewable energy source installation” set out in Article 2 sec. 13) a), defines a renewable energy generator as an installation constituting a dedicated set of devices used to produce energy, connected in a single point of connection, where the energy or heat is produced from one sort of renewable energy source, as well as an energy storage facility connected to this set of devices.
- The Act on RES does not say how energy generated prior to 1 January 2016 should qualify for green certificates, i.e. whether such support should cover only turbines that generated energy prior 1 January 2016 or an entire installation (the total number of turbines), even if only one turbine commences generating energy before chapter 4 of the Act on RES enters into force
- As the definition of an installation refers to set of devices producing energy, it is questionable whether the final number of turbines as a whole will be entitled to green certificates or only devices that produced energy prior to 1 January 2016 may receive green certificates.
- A trial auction organised by the Polish Wind Energy Association took place at the end of April and the beginning of May 2015. About 140 investors participated in the trial. Almost 70% of the bids of wind installation submitted to the trial auction were priced between PLN 340 and PLN 400/MWh. In the auction procedure for new projects under 4000 MWh/MW per year with a capacity of more than 1 MW, the winners were wind projects which offered prices between PLN 240-323/MWh. Among the existing installations the winners were wind projects which offered prices between PLN 260-383/MWh. Auction prices for smaller projects with a capacity less than 1 MW oscillated around the maximum price. The winners of auctions below 1 MW were mainly photovoltaic projects. Due to the fact that cost-effective market bids, which enable investors to complete the construction of a wind farm investment, are above PLN 360/MWh, many commented after the auction that a mechanism should be introduced to combat underbidding.