The Ministry of Mining and Energy in Serbia has officially launched the country's maiden renewable energy auction, seeking 450 MW capacity in the form of 400 MW wind and 50 MW solar power plants, as part of its 3-year Incentive System Plan under which a total of 1.3 GW is to be auctioned.
For wind energy projects, the minimum plant capacity needs to be 3 MW, and for solar this limit is 500 kW. Winners will enter into a contracts for difference (CfD) for 15 years.
The auction will see 450 MW renewable energy contracted for the allocation of market premium. Through the latter, renewable energy producers are paid the difference in the price at which clean energy is contracted via the auction and the market rate, by the state. In case, the market price is higher than the contracted price, then the renewable energy producer will pay the difference to the state.
Prices are capped at €105/MWh for wind and at €90/MWh for solar power plants. Winners will be decided on the basis of lowest price offered in a bid to bring down electricity costs.
"It is estimated that with the successful implementation of the auctions, Elektroprivreda Srbije (EPS) will earn more than €3 million annually, taking into account the relevant market prices," stated Energy Minister Dubravka Đedović.
The auction process is supported by the European Bank for Reconstruction and Development (EBRD) that's helped prepare legal and regulatory framework for conducting auctions (see Serbia Promoting Renewables With Laws & Financing).
"We are proud to support Serbia in their ambition to decarbonise the power sector and their ambitious targets to accelerate the integration of renewable energy sources through open and transparent auctions," said EBRD Head of the Western Balkans, Matteo Colangeli.
Last date to submit bids is August 14, 2023. Details are available here.
Over the next 3 years, Serbia will auction 1.3 GW renewables capacity under this CfD arrangement with a wind heavy plan. It plans to auction 1 GW wind and 300 MW PV capacity.