The Polish Ministry of Economy has published a new draft Renewable Energy Sources (RES) Act. The draft implements the support scheme first presented by the Ministry in September, subject to some adjustments.
Green certificates for existing installations
The current green certificates subsidy scheme for existing RES installations will remain essentially the same, except for the following changes:
- the duration of the support scheme will be reduced to 15 years from the first day of energy generation;
- green certificates will continue to be issued based on the amount of energy produced (i.e. 1 green certificate for 1 MWh); however, the support level for multi-fuel plants will be limited, i.e. support will only cover electricity produced up to the average level of energy generated in 2011-2013, and the number of green certificates available for 1 MWh will be reduced to 0.5;
- plants that use hydropower for generation with a total installed capacity higher than 1 MW will be excluded from the certificates scheme;
- if the generator sells electric energy at a price higher than 105% of the price published by the Regulator, green certificates will not be issued for such electric energy;
- an obligation to trade in green certificates on the Polish Energy Exchange will be introduced, up to the level of 55% in 2018;
- the “substitution fee”, which is payable by an energy seller if it does not meet its obligation to purchase a certain amount of green certificates and which sets the maximum market price for green certificates, will be fixed at 297.35 PLN/MWh (ca. EUR 70) and it will not be subject to indexation by the annual inflation rate;
- if the market price of green certificates falls below 75% of the “substitution fee”, paying the substitution fee will be prohibited and the purchase of green certificates will be mandatory.
Irrespective of the above, the existing obligation to purchase renewable electric energy introduced to the grid will be limited to 15 years from the first day of energy generation and transferred from “default suppliers” to the new group of suppliers indicated by the Regulator (“obliged suppliers”).
Auction mechanism for new and modernised installations
- an auction mechanism will be introduced for new projects and for plants subject to modernisation;
- existing plants will also have the possibility to choose between staying on the green certificates support scheme or accession to the new auction system;
- separate auctions will be organised for the above two groups of installations;
- irrespective of the above, separate auctions will be organised for installations up to and above 1MW;
- the choice of the projects in auctions will be made based only on the price per generation of 1MWh of electric energy;
- the purchase price will remain unchanged within the period covered by the auction;
- the volume of electricity to be purchased will be set in advance during the auction process;
- financial penalties will be imposed on generators if they fail to produce the energy in the set volumes;
- an obligation to purchase renewable electric energy from the installations chosen in the auctions will be imposed on “obliged suppliers” indicated by the Regulator;
- the duration of the support scheme (mandatory purchase) will be limited to 15 years from the first generation of energy, but will not last longer than the end of 2035;
- plants generating energy from biomass with power exceeding 50 MW as well as part of the multi-fuel plants will be excluded from the auction support mechanism;
- a special fee charged to energy off-takers will cover the difference between the costs of mandatory purchase of energy and the proceeds of the sale of such energy by the “obliged suppliers” in the market