BRATISLAVA, March 4, (WEBNOVINY) – Reverse auctions could regulate construction of solar and wind power plants in Slovakia in the future. Based on an analysis by the Slovak Economy Ministry, the auction would help select investors willing to build power plants also under lower feed-in tariffs. The length of the auction and the maximum price would be determined at the beginning of the auction. The caller would set the maximum installed capacity for the given year and investors would submit their projects. They would be aware that those demanding the lowest power purchase prices would be satisfied. This would increase pressure on minimizing the purchase price in the auction, the ministry explains. The department is hopeful that the auctions will help lower final electricity prices for consumers.
The volume of installed capacity should be set by the Economy Ministry and the national electricity transmission network operator SEPS on an annual basis in order to meet the national action plan for RES-based energy and to ensure safety and reliability of the transmission grid. The auctioned capacity should be known in advance. The auctions will be announced either by the ministry or the organizer of the day-ahead power market, the joint stock company OKTE. Should the results of auctions for wind and solar power plants be good, such auctions could be then introduced also for other renewables, according to the ministry.
The Energy Security Institute considers reverse auctions an appropriate instrument to increase transparency in allocation of limited technical capacity for renewables and to alleviate the impact of higher feed-in tariffs on final consumers. The investor will not get a fixed price as it is now. In the past fixed prices have been profoundly higher than the price at which the project is economically advantageous. On the contrary, it will be the investor that will offer a price for which it is willing to build the power plant. This certainly is a good way to support the economically most efficient projects, analyst with the institute Peter Marcan said regarding the new concept.
Among others, the ministry assumes that the organizer of the day-ahead market should be in charge or mandatory purchase of electricity generated from renewables because this could bring the power prices down. The subject would sell power purchased from power producers on the open market. The ministry further suggests that the Regulatory Office for Network Industries reassess the set feed-in tariffs in the future.
SITA
