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Home/News/Auction purchase of electricity from RES is fairer and better for Serbian consumers

Auction purchase of electricity from RES is fairer and better for Serbian consumers

Whether electricity producers from renewable energy sources will still be able to count on feed-in tariffs, ie whether Elektroprivreda Srbije will continue to buy electricity from them at higher preferential prices, or will an auction procedure be introduced instead, is a decision that awaits formation of the new Government of Serbia.
The decree on incentive measures for electricity production ceased to be valid on January 1. Accordingly, those producers who received the envisaged status before that deadline or submitted a request for obtaining it during that period are entitled to preferential prices when buying electricity. All those who submitted a request during this year have the right to acquire the status of a privileged producer, ie they have the right to incentive measures, but they cannot exercise them until the adoption of a new regulation. Whether it will be extended this year or will start auctions for the purchase of electricity from renewable energy sources will be known after the new government is formed.
– The current Government is working in a technical mandate and it cannot make decisions such as the one on the extension or definitive repeal of the regulation on incentive measures for electricity producers from RES. The newly elected ministers will make a decision on that topic at one of their sessions, and as things stand now, they will most likely opt for actions, which the expert public insists on – states Danas’ interlocutor, a good connoisseur of opportunities in the Serbian energy sector who wished to remain anonymous. By the way, the transition from the system of feed-in tariffs to auctions in Serbia was recommended by the Energy Community.
Feed-in tariffs for electricity obtained from renewable energy sources were introduced in 2013 and imply that Elektroprivreda Srbije pays more than regular electricity to its owners for a period of 12 years in order to pay off their investment. The cost of the feed-in tariff is borne by consumers through a fixed fee on the electricity bill, which amounts to 0.093 dinars per kilowatt hour.
Feed-in tariffs in Serbia depend on the source from which the electricity was obtained as well as on the power of the plant. The price for hydroelectric power plants is from 6 to 12.6 eurocents per kilowatt-hour. For biomass from 8.22 to 13.26. For biogas from 15 to 18.33 eurocents per kilowatt-hour. Electricity from waste costs 8.44 to 9.2 eurocents per kilowatt-hour.
The purchase price for wind power plants is 9.2, and for solar power plants from 12.4 to 14.6. Geothermal power plants get electricity, which EPS pays 8.2, and from waste power plants 8.57 euro cents per kilowatt-hour. For power plants that combine electricity and heat, the price is 7.45 to 8.2 eurocents per kilowatt-hour.
According to available data, in 2016, EPS collected 20.8 million euros, from consumers for electricity obtained from renewable energy sources. So far, about 130 small hydroelectric power plants, five wind farms and two large solar power plants have been built in Serbia, among other places.
The professional public believes that the auction procedure is more favorable for consumers. Instead of feed-in tariffs whose amount is high and fixed in the case of the auction procedure, the most favorable bidder is selected and the maximum amount of subsidy, which the investor still receives, is prescribed to be lower than the previous ones formed according to feed-in tariffs. This specifically means that the fee for renewables on electricity bills will be lower than it is now the case.
Energy expert Vojislav Vuletic told Danas that it is much fairer for consumers to introduce the auction purchase of electricity from renewable energy sources instead of feed-in tariffs.
– In that way, the price at which EPS buys electricity from producers from renewable sources would be lower, which would be reflected in the amount of the price of electricity for consumers. Namely, it would be lower than it is now when there are feed-in tariffs. I think that the authorities in Serbia should listen to the recommendation of the Energy Community on that issue. Simply put, Europe entered this process before us, they have more experience on that issue and the solutions they propose should be accepted. Therefore, from this year, EPS should buy electricity from renewable sources at auctions – our interlocutor concludes, Danas reports.