ENG EUEA Members Survey

Dear EUEA Members,

✔️ The Working Group (WG), which includes representatives of several EUEA members, has drafted a law on the RES producer's withdrawal from the Balancing Group of the Guaranteed Buyer (hereinafter BG GB), as an alternative to initiatives that may have negative consequences for RES producers (withdrawal from the BG GB by order for the period of martial law and 6 months after, no guarantees of return to the BG GB after wartime, etc.)

Attached – - the mentioned draft law, which proposes to make a number of amendments to the Law “On the Electricity Market”, and the Law “On Alternative Energy Sources”.

To determine the general position of the Association, which will be reflected in the final version of the draft law, please answer the following 3 questions

(in Google form or by mail at iryna.pashchuk@euea-energyagency.org):

📍Deadline: June 15, 2022, until the end of the day.

SURVEY

1.Trade in RES producers under bilateral agreements.

The draft law № 7238 in the following wording will soon be voted in the Verkhovna Rada:

«6) "Electricity producers (except for electricity producers who have a" green "tariff, and electricity producers who have acquired the right to support as a result of the auction) sell electricity under bilateral agreements exclusively in electronic auctions, the procedure for which is approved by the Cabinet of Ministers of Ukraine". There are three options for reconciling the consolidated position:

А) to agree with the wording of the draft law №7238 (allows to sell under bilateral agreements without auctions to producers who have set a "green" tariff, including those who will leave BG GB);

B) to offer a text edition that will allow to sell without auctions to all RES producers, including those who will continue to work without state support;

C) to propose an edition that will oblige all producers to sell at auctions (all producers must be on equal terms, RES producers work at the same level as the traditional generation).

2. The minimum period of stay outside the balancing group of GB.

There are three options for reconciling the consolidated position:

A) 3 months,

B) 6 months,

C) 12 months.

3. Unloading of RES producers.

There are three options for reconciling the consolidated position:

A) leave the payment for unloading SP RES on the "green" tariff (manufacturers included in the BG GB, and those who left the BG GB). Minus the option - non-acceptance of the proposal by MPs during the draft law due to the financial burden on NPC Ukrenergo and failure to achieve the goals of withdrawal of producers from BG GB;

B) set another payment for unloading for SP RES, which came out of BG GB (for example, at the price of DAM or some other formula);

C) identify the specifics of the participation of RES producers in the balancing market (for example, RES producers submit applications in the balancing market only for unloading, guaranteed bid price). Accordingly, it will apply to producers who leave BG GB and lose the status of SP RES, and to those who do not receive state support.

# In general, the draft law provides:

1) Remove the provisions of Article 8 of the Law "On Alternative Energy Sources" on the provision in the State Budget of 20% of the Guaranteed Buyer's costs to pay for electricity produced from alternative sources.

2) Create conditions for unimpeded exit/entry into the Balancing Group of the Guaranteed Buyer (BG GB) of producers at the "green" tariff, namely:

the right of RES producers to leave/return to BG GB at their own discretion on the applicant's principle has been established (GB cannot refuse). At the same time, the contract with the GB is suspended (rather than terminated), which is a more secure way to return producers to the BG GB;
exit/return occurs by notifying the Guaranteed Buyer by September 1 of the current year, provided that the manufacturer plans to leave/return from/to the Balancing Group from January 1 of the following year. Accordingly, exit/return to BG GB is possible not more than once a year.
the specified term (frequency) is justified by the fact that it is necessary to ensure predictability of financing by the TSO of RES producers that will remain in BG GB (setting the NPC tariff, trading strategy of GB). Plus avoiding the possibility of manipulating the market by participants by entering/exiting to/ from BG GB to achieve price advantages;
consequences of the suspension of contracts with producers under the "green" tariff (producers do not lose the right to the "green" tariff, fulfillment of obligations under suspended contracts, and other issues).

3) Create favorable conditions for the work of RES producers, which come from BG GB, in the electricity market, namely in part:

in the market of bilateral agreements: a) to grant the right to sell electricity without participating in electronic auctions; b) protect against possible restrictions related to the conclusion of bilateral agreements on a long-term basis;
in the ancillary services market it is proposed to give producers who have left BG GB the right to participate (non-obligation) in the ancillary services market until the end of the "green" tariff (until 31.12.2029);
in the balancing market, the right to provide load reduction services is given to all RES producers who have a "green" tariff (both those who left BG GB and those who are in BG GB).

З повагою,

Команда ЄУЕА
Адреса: м. Київ, вул. Дорогожицька 3, UNIT City, корпус В9, каб. 5
Mobile (WhatsApp): +38 091 331 0010
mailto: office@euea-energyagency.org

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