This is the upper limit of the price decided by the ΙΠΕΝ in the tenders for 1 GW of storage stations – Questions from investors

By | May 19, 2023

Bids of less than 115,000 euros per Megawatt per year will be called by interested parties to claim MW in the next tender A for storage plants, since, according to information from energypress, at this point the pending Ministerial Decision sets the maximum value of departure allowed.

It is recalled that the corresponding section of the plan of the Ministry of Health, which had been submitted to public consultation, had been left blank to be subsequently completed by the Ministry and included in the now final Decision.

As established in article 6 of the Ministerial Decree, the aforementioned price only refers to the 1st Competitive Process, leaving open what will be applied to the next two competitive processes (B and C) that are expected to follow. As is known, the portfolio to be auctioned in the investment and operational support tenders for autonomous batteries amounts to 1000 MW, with the first process being 400 MW, the second 300 MW and the 3he 400 megawatts.

How are the things going write energypress, the first auction is expected to take place at the end of June, which requires the signing of the corresponding MA, followed by the second in the third quarter of the year and the 3he and finally within the fourth quarter of the year. Let us clarify that the third tender refers to projects intended to be installed exclusively in the Apolignitization Zones (Z.AP.), that is, in the Kozani and Florina Regional Units of the Western Macedonia Region, as well as in the Municipality of Megalopolis in the Peloponnese.

What investors ask

It is worth noting that the market interest is particularly significant, market executives told energypress, which is demonstrated both by the candidates (inside and outside Greece) preparing to participate in the auctions, as well as by the ” anguish” to clarify issues that remain unclear within the Ministerial Decision.

Among the issues that come to energypress and that concern the auctions of autonomous batteries, a “common point” is the way of calculating the reference income, from which the operating aid will be calculated.

In short, the market executives who try to “decipher” the provisions of the Ministerial Decision, identify a “gap” in the way in which the income of a station will be calculated, what will be the maximum acceptable IRR within a station by the regulator etc

At the same time, there are doubts about the amount of investment aid for Competitive Process C, for which there is no specific provision in the Draft Ministerial Decision. This provides, as is known, the amount of investment aid for Competitive Process A’ and B’ and which is set at 200,000 euros per megawatt.

It should be noted that the draft Ministerial Decision includes a series of provisions aimed at the “equity dispersion” of the MW that will be auctioned.

In particular, article 5 establishes the limits of the validity of the participation and the award in order to guarantee competitive conditions. Initially, a minimum number of four participants is established in each contest who are not Affiliated Persons. There is also a maximum limit of 100 MW of Participation Power of each plant and a maximum limit of participation power per participant in each competitive process, which is set at 25% of the auctioned power.

Likewise, article 15 numeral 13 of the YA plan establishes that “SAEU holders must present to the RAAEY, annually during the entire Promotion Period, a declaration in which they prove that they are not the holder of any of its Affiliated or Collaborating Companies, in the meaning of Commission Recommendation 2003/361/CE (OJ 124 of May 20, 2003, p. 36):

(a) Reinforcement of the United Nations of the Competitive Process A’ and B’ with a power greater than 100 MW,

(b) Reinforced NU of the 3rd Competitive Process of more than 25% of the amount auctioned in said Competitive Process”.

Therefore, it can be deduced from the foregoing that a company and its subsidiaries that will participate in it may not award projects with a capacity greater than 25% of the capacity tendered in any competitive process. The same maximum quota will also be applied to the entire portfolio to be qualified, of which again up to 25% may belong to the same company and its subsidiaries. This means that, out of the 1,000 MW portfolio, the same investor cannot directly or indirectly own independent batteries with a power greater than 250 MW.

Finally, with reference to article 15, cited above, it can be deduced that the beneficiaries whose portfolios will be qualified for bidding will be asked annually for a declaration in which they prove that their available portfolio moves “within the limits”. Therefore, a company cannot buy subsidized batteries, ultimately increasing the proportion of subsidized assets beyond the 25% stipulated in the tender.

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