Summary of Draft Law on Renewable Energy Auctions

Draft Law introducing new support system for renewable energy projects in Ukraine has been registered with the Parliament on 07 June 2018 under registration number 8449. New support system based on auctions will apply to the solar power plants with installed capacity exceeding 10 MW and wind power plants with installed capacity exceeding 20 MW. First auctions will be held in 2020, the Government will approve respective technology-specific quotas and auction conditions by 01 December 2019.

Auctions will be held by the Guaranteed Buyer, state-owned entity being part of new electricity market infrastructure. The Guaranteed Buyer will buy electricity from renewable energy producers under Power Purchase Agreement (PPA) and will compensate the difference between the electricity market price and the auction price via Contract for Difference (CFD). PPA and CFD will have 20 years term. Auction price will be fixed in EUR.

If solar and wind power plants mentioned above secure land titles, grid connection, construction permit and sign pre-PPA by 01 July 2019, they will be able to stay at existing feed-in (green) tariff system that expires at the end of 2029. They will have 3 years from date of pre-PPA signing to commission power plant and receive approval of the feed-in tariff set for the year of commissioning.

Other solar and wind power plants as well as other electricity producers from RES (biomass, biogas, small hydro, etc.) are exempted from auctions and will stay at the current feed-in tariff system unless it is their wish to take part in respective auctions to get 20 years support.

Feed-in tariff for solar power plants commissioned after 01 January 2020 will go down by 30% vs. 10% currently envisaged by the law. No changes in green tariffs for other RES producers compared to effective version of the Law on Alternative Energy Sources.

Detailed summary of the Draft Law is provided below in attached files (Ukrainian and English versions).

IMEPOWER Draft Law RES Auctions Summary 2018 07 06 Ukr

IMEPOWER Draft Law RES Auctions Summary 2018 07 06 Eng

Source: imepower.