RES support and electricity market - CZ news
2007
J. Knápek
3.9.2007
RES legislation and logic of support
Act 180/2005 on RES-E support – no update
Logic of support remains the same
feed-in tariffs derived from regulated rate of return (WACC=7%)
Changes in „sub legislation„
Notice 150/2007 ERO (on regulation) – support is assured during „technical“ lifetime of technology
Update of ERO notice to Act 180/2005 on technical and economic parameters of RES-technologies
News in RES-E support
Up-date of notice ERO 475/2005
up-date and revision of feed-in tariffs for new plant after 1.1.2008
expected changes
• technical lifetime for PV from changed from 15 to 20 years
• changes in investment cost for the plant – impact of cost curves for individual RES-E technologies (e.g. SH increase)
• changes in assumptions for inputs to biogas stations – current tariffs derived from assumption of exclusive waste processing (intentionally planted biomass – price assumption for 2008 app. 25 EUR/t)
News in RES-E support 2
EU Funds
Program EKOENERGIE – MPO
• Submitted projects app. 12 bil. CZK
• RES-E and energy savings as priorities
Opened question if and how to include investment support into calculations
Changes in macroeconomic environment
tax reform: reduction of income tax from 24% to 15%
income tax exemption for RES-E project (5+1 years) is expected to remain
changes in depreciation scheme
News in RES-E support 3
update of technical and economic parameters based on statistical analysis supported (2004-2006) and prepared projects
e.g. new large SH: Ni=6300 EUR/kW, Tm=5750 hours
MVE do 100 kW - investice
y = 21461x-0,3704
R2 = 0,1116
0
50 000
100 000
150 000
200 000
250 000
300 000
350 000
400 000
450 000
500 000
0,000 0,020 0,040 0,060 0,080 0,100 0,120
výkon [MW]
měr
né
inve
stic
e [t
is.K
č/kW
]
ni [tis.Kč/kW] Mocninný (ni [tis.Kč/kW])
MVE do 100 kW - využití
y = -245,23x + 3906,8
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
0,000 0,020 0,040 0,060 0,080 0,100 0,120
výkon [MW]
ročn
í vy
uži
tí [
ho
d/r
ok]
T r [hod/rok] Lineární (T r [hod/rok])
Examples of technical and economic parameters
Biogas – existing projects, Tm=7500 hours, Npal=1,2 CZK/kWh
Bioplyn - investice
y = -14914x + 113978R2 = 0,022
0
20 000
40 000
60 000
80 000
100 000
120 000
140 000
160 000
180 000
0,000 0,500 1,000 1,500
výkon [MW]
měr
né
inve
stic
e [t
is.K
č/kW
]
ni [tis.Kč/kW]
Lineární (ni [tis.Kč/kW])
Bioplyn - palivo
0
0,2
0,4
0,6
0,8
1
1,2
1,4
1,6
1,8
2
0,000 0,200 0,400 0,600 0,800 1,000 1,200 1,400
výkon [MW]
měrn
é p
alivo
vé n
ákla
dy [
Kč/k
Wh
]
npal [Kč/kWh]
Biogas – new projects, Npal=1,5-1,5 CZK/kWh
Examples of technical and economic parameters 2
WindVítr - investice
y = 344,49x + 37551
R2 = 0,0253
0
10 000
20 000
30 000
40 000
50 000
60 000
0,000 5,000 10,000 15,000 20,000
výkon [MW]
měrn
é in
vesti
ce [
tis.K
č/k
W]
ni [tis.Kč/kW]
Lineární (ni [tis.Kč/kW])
Vítr - využití - bez extrémních hodnot
0
500
1 000
1 500
2 000
2 500
3 000
0,000 5,000 10,000 15,000 20,000
výkon [MW]
roč
ní
vy
uži
tí h
od
/ro
k
T m [hod/rok]
PV: boom of projects
expected Ni: app. 135 th. CZK/kW (4,96 th. EUR/kW)
expected Tm: in range 908-980 hours (will be decided)
BiomassBiomass
cannibal effect:
• biofuels
• RES-E, heat
• other
introduction of ecological taxes (coal, electricity, etc.)
general increase of prices (straw, planted biomass)
big projects for co-firing still only moderate progress
Unclear support for SRC plantations
RES-E development
Identification of barriers (non economic barriers seems more important than we expected (regional planning, EIA, environmental protection, etc.)
Wind power and PV projects, biomass slower than expected
0
1000
2000
3000
4000
5000
6000
2000 2001 2002 2003 2004 2005 2010
GW
h
Biogass Wind Biomass Municipal Waste Small Hydro Large Hydro Other
24812772
1874
3181
2768
3135
5720
Electricity market
Electricity exchange in Prague founded in 2007
Auctions of CEZ virtual power block canceled, all electricity traded via exchange
August 27, 2007: end of first trade period – electricity for 2008 and 2009
electricity traded in lots (2008+2009), 2008 with fixed price 50,42 EUR/MWh (ˇ+14% increase), 2009: traded price 57 EUR/MWh
from September 2007 electricity will
be traded for 2008 and 2009 indepen-
dently and without fixation
Average electricity price, base load, year forward
54
43
37
29
32
35
46
5156
20
25
30
35
40
45
50
55
60
2004 2005 2006 2007 2008
EU
R/M
Wh
ČR
Germany
???
+11,4% +15.0% +19,5% +???
Source: ČEZ, 19.4.2007
Electricity generation in CR - future
Majority of coal fired power plants is on the end of life (2012-2015)
Coal limits will not broken – shortage of coal (not all existing capacity will be rebuilt)
Quick continuous increase of domestic electricity consumption (current economic growth 6-7%)