HWEA’s Proposal for the new support mechanism for RES
Monday, 2 November 2015
The Hellenic Wind Energy Association HWEA/ELETAEN has published its analytical proposal for the design of the RES support mechanism. The proposal does not deal with the future rules of the new electricity market. However, it is accompanied by a study carried out on behalf of HWEA by the international firm Poyry, as part of the consultation conducted by RAE on that matter about a year ago. The proposal for the new mechanism includes:
- Adoption of a system of variable feed-in premium with one-way payments, with the Imbalance Marginal Price (hourly) as reference price with a protection threshold. This design ensures stable income for the RES stations for the first few years that, virtually, there is no market in which they can participate. After configuring the new market, the RES stations will undertake market obligations and, as explained, their income will depend on how they respond to them. The absence of the new total electricity market imposes to not select as reference price a mean value within any time window
- The administratively defined strike price is proposed to be slightly increased in relation to the prices set by law 4254/2014. Of course, the strike prices will be updated and revised each year for new projects based on the LCOE of the portfolio of projects that are expected or sought to be realized.
- For the exemptions, it is proposed to apply the limits laid down in the Guidelines and to exclude stations in non interconnected islands
- With regard to the transitional provisions: It goes without saying that the new legislation will not affect the operating and under construction projects and should contain sufficient transitional provisions. The new legislation should not affect the PPAs to be signed until its enactment. Also, projects which will have been awarded a binding grid connection offer having filed the relevant letter of guarantee up to 31.12.2015 should remain in the current FIT system (see par. 3).
- The method of funding the FIP support mechanism of the new projects should be distinct from the funding of the FIT mechanism of the pre-existing projects and be undertaken by suppliers
- On the issue of determining the premium through tendering or not from 01.01.2017, HWEA substantiates with this proposal that, especially for wind energy, Greece fulfills the criteria laid down in the Guidelines for exemption from that obligation.