Budgets Of The 2020 RES Auctions

1. The Council of Ministers regulation on the maximum volume and value of electric energy from renewable energy sources that may be sold in auctions in 2020 ("Budget regulation") was published in the Journal of Laws on 22 January 2020 and became effective on 23 January 2020. We commented on the draft regulation in a previous newsletter.
2. The Budget regulation includes budgets for the initial round of RES auctions out of two expected in 2020. An additional regulation on reference prices (cap prices) needs to be adopted to set the remaining auction parameters, allowing the Energy Regulatory Authority to proceed with organizing the auctions. No draft regulation has been announced yet.
3. The government announced its intention to organize two rounds of auctions in 2020. The Budget regulation includes the budgets for the first of these rounds – the budgets for the second rounds are not yet known.
4. Following the reasoning of this regulation, the budget will allow the deployment of small PV projects with total capacity approx. 800 MW. As regards the auction for large PV and wind projects (above 1 MW), the government estimates that approx. 800 MW of wind projects and 700 MW of PV projects will be able to secure support. Accordingly, the government expects that most of the wind projects which lost auctions in 2018 and 2019 will eventually secure support in 2020 and there will still be room for utility-scale PV installations in this basket. Other installations (biomass, biogas and hydro) can compete for a budget supporting up to 160 MW of new projects; however, recent auctions demonstrated limited interest of investors to put forward such projects in RES auctions.
5. The government's expectations in terms of RES deployment resulting from the auctions in 2020 are presented in the table below:

6. Energy source	Small	Large
   Wind	-	800 MW
   Solar energy	800 MW	700 MW
   Hydropower	10 MW	20 MW
   Agricultural biogas	20 MW	-
   Biogas: landfill and sewage treatment	10 MW	-
   Biomass: dedicated biomass combustion	-	100 MW

7. Below we present the final budgets and volumes for particular installations in 2020. As per the Act on Renewable Energy Sources ("RES Act") there are five "baskets" for installations, sorted by, among others, technology criteria. Additionally, separate auctions are organized for installations, which started generating electricity before 30 June 2016 and wish to migrate to the auction system ("Existing Installations") and installations which will start generating electricity after the auction ("New Installations"). Furthermore, projects and auction budgets are also split between installations with a total installed capacity of up to 1 MW ("Small Installations") and installations with a total installed capacity of over 1 MW ("Large Installations").

    

   New Installations

   Basket	2019		2020
   	Small Installations	Large Installations	Small Installations	Large Installations
   Biogas other than agricultural, hybrid systems, installations of thermal combustion	0	14 910 000 MWh 5 577 600 000 PLN	375 000 MWh 166 875 000 PLN	10 950 000 MWh 5 182 500 000 PLN
   Hydropower, bioliquids, geothermal energy, offshore wind energy	140 400 MWh 71 280 000 PLN	594 000 MWh 285 120 000 PLN	540 000 MWh 270 000 000 PLN	1 080 000 MWh 518 400 000 PLN
   Agricultural biogas	1 341 821 MWh 939 274 880 PLN	1 170 000 MWh 678 600 000 PLN	0	1 800  MWh 1 152 000 000 PLN
   Onshore wind energy Solar radiation energy	11 445 000 MWh 4 213 650 000 PLN	113 970 000 MWh 32 000 000 PLN	11 760 000 MWh 4 527 600 000 PLN	46 290 000  MWh 14 015 850 000 PLN
   Hybrid RES installation	0	0	0	0

    

   Existing Installations

   Basket	2019		2020
   	Small Installations	Large Installations	Small Installations	Large Installations
   Biogas other than agricultural, hybrid systems, installations of thermal combustion	1 120 000 MWh 694 400 000 PLN	34 000 000 MWh 20 740 000 000  PLN	0	0
   Hydropower, bioliquids, geothermal energy, offshore wind energy	1 475 211 MWh 71 280 000 PLN	594 000 MWh 811 366 050 PLN	0	0
   Agricultural biogas	1 149 296 MWh 838 986 080 PLN	3 433 219 MWh 2 197 260 000 PLN	0	2 500 000 MWh 1 600 000 000 PLN
   Onshore wind energy Solar radiation energy	0	0	0	0
   Hybrid RES installation	0	0	0	0

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