Consolidate position of the EUEA members on the Auction Support System of RES

Consolidate Position

of the European-Ukrainian Energy Agency Members

Recommendations to the Draft Law (Reg. No. 8449) concerning New State Support System of

Renewable Energy Sector

Recognizing the need to consolidate efforts in support of a stable, sustainable development of the "clean" generation in Ukraine and taking into account Ukraine's commitments to the national and foreign investors, which have been making valuable contribution to the renewable energy generation development. The members of the European-Ukrainian Energy Agency would like to support Ukrainian reforms in renewable energy sector with this statement.

We agreed to support the following proposals to the draft Law "On Amendments to some Laws of Ukraine on the Development of Competitive Electricity Production from Alternative Energy Sources" (Reg. No. 8449):

  1. Date of introduction of the new support system - January 1, 2020 should be the date of the introduction of the new support system due to the draft law.
  2. Entities for which participation in auctions is obligatory - The draft law stipulates that participation in auctions is mandatory starting: from January 01, 2020: for SPP> 10 MW, for WPP> 20 MW; from January 01, 2021: for SPP> 5 MW, for WPP> 20 MW; from January 01, 2023: for SPP> 1 MW, for WPP> 3 MW; other types of RES, including biomass and biogas electricity generation, when their share exceeds 15% of the total RES market, mandatorily participate in auctions similar to those for SPP and WPP projects.
  3. Entities eligible to participate in the auction - The right of entities with all types of RES to participate in auctions should be enshrined in the draft law.
  4. Retrospective change of support conditions, feed-in tariff - The  draft law does not in any way change the support conditions for already commissioned objects of RES, does not change terms of the feed in tariff, leaves the current regulation, namely the validity of the feed in tariff until 2030
  5. The duration of the support of the winner of the auction - The draft law should stipulate the provision according to which the term of support to the winner of the auction is 20 years (since COD)
  6. Quantification - Who defines and approves - Cabinet of Ministers of Ukraine approves at the request of the Ministry of Energy and Coal Industry  in accordance with the proposal of the System Operator.
  7. Quota planning period - It should be prescribed in the draft law that the period of planning of the quotas is 5 years with clearly defined possibilities for the annual adjustment (no more than 10% in the direction of reduction) in accordance with the Development Plan of the transfer system, taking into account the international obligations of Ukraine in the field of development of RES
  8. Who approves the order of the auctionsThe provisions according to which the procedure for holding auctions is established by the Cabinet of Ministers of Ukraine should be prescribed in the draft law.
  9. Contractual design - The bill should stipulate the provisions according to which, due to the results of the auction, a single contract for the sale of electrical energy between a business entity, which by the results of the auction has acquired the right to state support and a guaranteed buyer who pays the entire amount of support under the contract shoud be signed.
  10. Regulation of the concentration issues - In order to apply the current rules of antimonopoly legislation to regulate concentration issues from the text of the bill, it is required to remove from the text the restrictions on the receipt of part of the national quota by the auction participant.
  11. Settlement of the issue of timeliness of the terms of the accession - The bill should stipulate the provisions according to which the technical conditions is valid for 5 years from the date of issue and the term of operation of technical conditions is extended for the winner of the auction for the term of construction and putting into operation.

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