Sixteen investors with a total power plant capacity of 816.48 MW applied for the first auction for the allocation of market premiums for renewable energy sources, out of which 602.8 MW were offered to fill the quota, while the estimated investment value of all power plants amounts to EUR 1.26 billion.
First market premium auctions for green megawatts completed
16 August 2023
The seriousness of the bids received is evidenced by the fact that the interested companies submitted bank guarantees and cash deposits worth more than EUR 18 million, which guarantees their intention to implement the projects.
From the total number of registered investors, 11 participants qualified for the bidding stage. In the auction procedure for wind power plants, four investors filled the quota, while three filled the quota in the solar power plant auction. The lowest offered price was EUR 64.48 per megawatt-hour (EUR/MWh) for wind power plants, or EUR 88.65 per megawatt-hour for solar power plants.
"The auctions for the allocation of market premiums for a total of 450 MW are the largest auctions that are conducted at once in the Western Balkans region and the first auctions within the three-year incentive plan through which we will secure a total of 1,300 MW from green energy. We can be extremely satisfied with the response of investors, which represents the best recognition for the work on improving the legal framework and at the same time shows the confidence that the Republic of Serbia enjoys among investors when it comes to investments in the green energy sector. The realised prices for most of the capacities are almost twice lower than the current market prices, so we have plenty of reasons to be satisfied, especially since we will get an additional 550 MW, which will double the total current green energy capacity in Serbia. This is very important for the economic growth of our country, as it will generate investments worth more than one billion euros in the next few years," said Minister of Mining and Energy Dubravka Djedović.
She reminded that the auction procedure is digitized and that is being implemented through the portal oieauctions.mre.gov.rs, which ensures an efficient and transparent selection of projects.
She emphasized that the successful implementation of the auction process is an important step in the process of transitioning to cleaner energy sources, increasing electricity generation and achieving higher level of security of supply for citizens and the economy.
The market premium is an incentive for the generation of electricity by which the state protects the producer from changes in market prices compared to the price the producer offers at the auction by paying the difference between the offered price at the auction and the market price. If market prices are higher than the producer's offered price at the auction, the producer will pay the difference to the state. According to current projections, the state will earn revenue through the first auctions at the level of several million euros per year, in addition to all other benefits that auctions will provide.
