Second Tender for Freestanding PV Capacity Less Oversubscribed Than First Auction

The Federal Network Agency (BNetzA) received 136 bids in the second 150 MW tender for financial support under the Renewable Energy Sources Act (EEG) for freestanding PV power plants. The tender was more than three times oversubscribed, BNetzA said. Yet the number of bids was lower than the 170 bids made in the first ever PV auction for 150 MW that ended on 15 April 2015.

1. Further Procedure and Information on the Second Auction

BNetzA is currently reviewing compliance of the bids with the bidding regulations laid down in the Ordinance for Competitive Bidding for Financial Support of Freestanding Installations (FFAV). In the April tender 37 bids were rejected as formal requirements were not met. BNetzA therefore gave further guidance. The winning bids of the August tender will be announced on the agency’s website in due course.

Unlike in the April auction, a uniform pricing method will apply for the August tender. This means that successful bidders do not receive support as bid, but all successful bidders will receive support in the amount of the highest bid accepted. As the PV auctions are carried out to gain experience with auctioning financial support for renewables that shall start in 2017 at the latest, this pricing method that is also used by the electricity exchanges is being tested. An announcement of the financial support may be delayed if successful bidders do not make a second security deposit in line with Section 15 FFAV. Then the affected awards will lapse (cf. Section para. 1 FFAV). In that case BNetzA has to decide about a replacement procedure (Nachrückverfahren) according to Section 12 para. 3 FFAV.

At any rate financial support cannot be higher than the maximum value of 11.18 ct/kWh for bids set for the August auction.  This is slightly lower than in the April tender when it amounted to 11.29 ct/kWh, yet still higher than the reference value of 9.02 ct/kWh based on which the market premium for freestanding solar installations under the Renewable Energy Sources Act (EEG 2014) has been computed so far.

2. Background Information

Tenders determining financial support for freestanding PV installations are carried out in accordance with Section 55 EEG 2014 and the Ordinance for Competitive Bidding for Financial Support of Freestanding Installations (FFAV), which contains detailed stipulations regulating the auction procedure.

Section 55 para. 3 EEG 2014 stipulates that following a transitional period ending on 1 September 2015 financial support for new freestanding PV installations can only be claimed by those that successfully participate in auctions.

For general information in German on auctioning financial support for freestanding PV plants in the context of the EEG 2014, please see here. For information on the outcome of the first tender, please see here.

As Germany intends to tender financial support for all renewable energy sources as of 2017 at the latest, the Federal Ministry for Economic Affairs and Energy recently presented a key point paper for another amendment of the EEG and launched a consultation.

Source: Federal Network Agency

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