Long term clean energy auctions Sample Clauses

Long term clean energy auctions. ‌ Remuneration conditions affecting the compulsory supply of a certain block of clean energy (predefined amount of it) are set through an auction process taking place in the long term. Level of stability of RES revenues Medium level of stability. Prices earned by RES generation for predefined amounts of the clean energy they produce are largely defined in the long term. The equivalent price earned by RES generation for this amount of electric energy produced may not be fully fixed (depending on whether the full price, a premium, or a contract for difference (CFD) with respect to some reference price level is set in the auction). The amount of power produced that is not covered by the contract is deemed to be remunerated according to conventional energy prices. Level of correlation of RES prices with short term market ones (reflecting marginal costs) Variable, depending on whether the full price (no correlation), a premium (medium level of correlation), or a CFD with respect to some reference price level (low level of correlation) is set in the auction. Are prices earned by RES generation computed in a market process? If not, are they determined administratively? Yes, they are. Level of technology targeting Auctions may be specific to a certain technology or addressed to all mature clean technologies in the system. Level of efficiency in the use of public funds Normally, funds provided to RES generation are collected from tariffs paid by consumers, though they could come from the public budget. The overall level of funds transferred to RES generation depends on whether auctions address specific technologies or all clean ones. Level of centralization of prices earned by RES generation Prices are computed through centralized auctions organized at system level (should probably take place for all the European system jointly).

Long term clean energy auctions. Remuneration conditions affecting the compulsory supply of a certain block of clean energy (predefined amount of it) are set through an auction process taking place in the long-term. Prices earned by RES generation for predefined amounts of the clean energy they produce are largely defined in the long-term. The equivalent price earned by RES generation for this amount of electric energy produced may not be fully fixed (depending on whether a full price, a fix premium, or a floating premium with regards to some reference price level is set in the auction). The amount of power produced that is not covered by the contract would be remunerated according to market prices. A clean energy auction can be combined with any time of premium system. However, the remuneration is only given to a fraction of all the expected energy produced throughout the lifetime of the power plant (gross energy production). In that sense, the remuneration is not dependent on the energy dispatched. Alternatively, it could be linked to dispatch electricity, but since the overall amount of full-load hours remunerated is significantly lower than the expected energy produced, energy producers will not be incentivized to generate when prices are below their marginal productions costs. 11 Simply because it depends on (i) technology and (ii) meteorology or more generally the availability of the inputs and, for dispatchable technologies, of their cost and the wholesale electricity market prices. Thus, although it seems reasonable to evaluate the amount of electricity produced over a year by one GW of wind turbines, it seems much less obvious for biomass-fired thermal plants. This uncertainty is even reinforced in the case of technology-neutral auctions because there are significant discrepancies in the average load factors across technologies