We buy clean electricity three times more expensive than we sell at the “day-ahead” market – Guaranteed Buyer

The losses of the state-owned company Guaranteed Buyer exceeded 566.5 million UAH, if nothing is changed with a feed-in tariff, it will reach 15.9 billion UAH.  

 

“Each country wants the price of a resource to be as low as possible for its population, its industry. There is also a desire to take into account the environmental friendliness of this resource... to have sustainable clean energy. But these things must be balanced”, said Olexiy Ryabchin, Deputy Minister of Energy and Environmental Protection as part of his speech at the 11th Sustainable Energy Forum, which was held in Kyiv on October 16.

According to him, the Ministry held a meeting yesterday, during which problems from the point of view of the preciousness of paying a feed-in tariff to market participants were discussed, conducted by the Guaranteed Buyer:

“The net loss of Guaranteed Buyer for the fourth year, according to USAID calculations, is 566.5 million UAH. The net loss of the state-owned enterprise in 2020 may reach 15.9 billion UAH – if nothing is done”, said Mr. Ryabchin.

At the meeting the Deputy Minister said it had been decided to create a working group, which would include representatives of the sector and investors – “to find a common way out of the situation”.

As it is known, SE Guaranteed Buyer buys all “green” generation, carries out its sales at the market, as well as payment of a feed-in tariff (in the future, the company is responsible for conducting “green” auctions). During this year, renewable generation capacities grew by 410%, which resulted in a sharp increase in payments of a feed-in tariff.

Head of Guaranteed Buyer Kostiantyn Petrykovets noted that a high activity in the renewable energy market indicates the investment attractiveness of the sector, but at the same time it causes certain problems – financial problems of the enterprise that need to be solved:

“We buy all the electricity from producers from alternative sources and sell it at organized markets. Basically, this is the “day-ahead” market. We all perfectly understand that the purchase price of electricity is almost three times higher than the cost of selling at the “day-ahead”market. And in order to compensate for this difference, the company provides a service to the transmission system operator, the cost of which, in accordance with the Law “On the Electricity Market”, is equal to the difference between the price of purchased and sold electricity”, said Mr. Petrykovets.

According to him, the company today has already concluded 468 agreements (PPA) with renewable electricity producers. The total capacity of facilities with concluded PrePPA contracts (preliminary contracts for the sale of electricity) so far is 1900 MW.

“Despite the problems that were in July this year, at the moment the non-payment of a feed-in tariff has been partially resolved. We paid 100% to alternative energy producers for July. The amount is 3 billion UAH. As in August, a 100% calculation was made for a total amount of 3.4 billion UAH. For September, planned advance payments were made... to date, the National Energy and Utilities Regulatory Commission has submitted a calculation for 2 billion UAH” said the Head of the Guaranteed Buyer.

As it is known, from January 1, 2020, the system of support for the development of renewable energy has to be changed in Ukraine – instead of paying a fixed feed-in tariff, the auction mechanism will be launched. Along with the launch of auctions, existing feed-in tariff will be reduced – for solar generation by 25%, for wind – by 10%, a feed-in tariff for bioenergy generating capacities will not change.

 

Kosatka.Media

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