Premium tariff (Feed-in Premium)

Updated: 17.01.2019

Author: Georgios Maroulis

From 2016, RES and CHP plants to be connected to the transmission system participate in the electricity market and are awarded a sliding feed-in premium (called “Operating support based on a differential compensation price”). From 2017, feed-in premium is granted through tenders (see “Tender”). Hence, Operating Support Contracts for wind power plants ≥6MW and other RES plants ≥1MW are on hold until a tender is announced. Exemptions apply to smaller installations, which are eligible for a feed-in tariff (s. Feed-in Tariff I).

Eligible technologies

All RES technologies are eligible (art. 4 par.1b Law No. 4414/2016).

Geothermal energy

Eligible (art. 4 par.1b Law No. 4414/2016).

Wind energy

Eligible (art. 4 par.1b Law No. 4414/2016).

Solar energy

Eligible (art. 4 par.1b Law No. 4414/2016).

Biogas

Eligible (art. 4 par.1b Law No. 4414/2016).

Hydro-power

Eligible (art. 4 par.1b Law No. 4414/2016).

Biomass

Eligible (art. 4 par.1b Law No. 4414/2016).

Amount

RES and CHP plants to be connected to the transmission system participate in the electricity market and are eligible for a sliding feed-in premium (called “Operating support based on a differential compensation price”) (art.3 par.1 Law No.4414/2016). The support is calculated as a difference between the Special Market Price for each renewable technology and the Reference Price stipulated in the Operating Support Contract (art.3 par.1 Law No.4414/2016). Special Market Price is defined as follows (art.6 Law No. 4414/2016): 

  • Wind, PV, small hydro: The monthly weighted average price of each respective technology that is based on the Marginal Average System Price, while other factors can be taken into account; 
  • Biomass, biogas, Concentrated Solar Power (CSP), geothermal, CHP: The monthly average of the Marginal Average System Price.
The concrete methodology still has to be defined by the Ministry of Environment and Energy. Furthermore, wind power plants ≤3MW and other RES ≤500kW (excluding PV) may be awarded Operating Support Contract (fixed price), which equals the Reference Price (art.3 par.5 Law No. 4416/2016). RES are also awarded Operating Support Contract (fixed price), however only under the precautions stipulated in art.8 Law No. 4414/2016. Below, the Reference Prices for each respective renewable technology are provided (art.4 par.1b Law No.4414/2016). It should be noted that Reference Price is not applicable to plant operators that have won a tender. For tender winners the bid substitutes the Reference Price (art.3 par.3 Law No. 4414/2016).

Wind energy

98 €/MWh (art.4 par.1b Law No.4414/2016).

Solar energy

CSP: 257-278 €/ MWh

PV ≤500 kW: 1,2* MASPv-1

(MASPv-1= Marginal Average System Price of the previous year (art.4 par.1b Law No.4414/2016).

Geothermal energy

≤5MW: 139 €/ MWh

˃5MW: 108 €/ MWh

(art.4 par.1b Law No.4414/2016).

Biogas

Landfill biogas

  • ≤ 2 MW: 129 €/MWh
  • >2 MW: 106 €/MWh

Biogas from biomass

  • ≤ 3 MW: 225 €/MWh
  • > 3 MW: 204 €/MWh

(art.4 par.1b Law No.4414/2016)

Hydro-power

≤3MW: 100 €/ MWh

3MW- 15MW: 97 €/ MWh

(art.4 par.1b Law No.4414/2016).

Biomass

  • ≤1MW: 184-193 €/MWh
  • 1MW-5MW: 162€/MWh
  • 5MW- 15MW: 140 €/MWh (art.4 par.1b Law No.4414/2016).

Furthermore, the Reference Prices for CHP are the following:

  • 1MW-5MW: 80/84 €/MWh + NGPA
  • 5MW-10MW: 74/78 €/MWh + NGPA
  • 10MW-35MW: 68/72 €/MWh + NGPA
  • Above 35MW: 61/65 €/MWh + NGPA

NGPA (Natural Gas Price Adaptation) is calculated with the following equation: (Mean Monthly Natural Gas Price-26) * (1-(n-ne)/nhr)/ ne, where ne= thermal performance level of CHP, nth= thermal performance level of CHP, n=ne+nth. Price differentiation depends on the type of technology the CHP plant is employing.

Addressees

Entitled party. The persons entitled to participation in the tender are those plant operators that hold a generation licence and participate in the electricity market.

Obligated party. For Operating Support Contracts (FiP) in the continental system - Former LAGIE- DAPEEP (RES and Guarantees of Origin Regulator) (art. 9 par. 1 Law 4414/2016).

Procedure

Process flow

  • RES or CHP plant operator concludes an Operating Support Contract (FiP) with theformer LAGIE- DAPEEP (RES and Guarantees of Origin Regulator) and/or the Hellenic Distribution Network operator (HEDNO) (art. 9 and art. 10 Law No. 4414/2016).
  • Plant operator is registered and participates in the electricity market (art. 5 Law No. 4414/2016).
  • For FiP: The support is calculated as the difference between the Special Market Price for each technology and the Reference Price stipulated in the Operating Support Contract (art. 3 par.1 Law No. 4414/2016). In addition, the plant operator receives the revenues from its participation in the electricity market. The level of support is calculated on a monthly basis. For wind power plants an additional compensation is paid in case of curtailment. This compensation is calculated on an annual basis as well (art. 5 par.6 Min. Res. F1/ 187706).
  • Former LAGIE-DAPEEP (RES and Guarantees of Origin Regulator) pays off the amount of support.

Competent authority

Former LAGIE-DAPEEP (RES and Guarantees of Origin Regulator) is the competent authority for paying off the FiP and Fixed Price.

Flexibility mechanism

The statistical transfer of a certain amount of RES electricity is possible by an agreement with the Member States. The duration of such an agreement may exceed one year. Every three months, a report will be published by the Ministry of Environment and Energy on the total amount of electricity produced from RES in the previous year. (art.32d Law No. 3468/2006). In any case, the European Commission must be three months in advance informed of the pending termination of an agreement (art. 32a Law No. 3468/2006).

Degression

Reference Prices are amended yearly, every first trimester (art.4 par.5 Law No.4414/2016). Reference Price is not taken into account if a plant operator has successfully won a tender. In that case, the bid substitutes the Reference Price (art.3 par.3 Law No. 4414/2016). Apart from that, the level of the FiP is reduced if the plant operator receives any kind of investment support (EU support is excluded). In this case the level of support is reduced according to the Capital Depreciation Coefficient (art.3 par.7 Law No. 4414/2016).

Cap

From 2017, feed-in premiums (Operating Support Contracts) are awarded through tenders (art.7 Law No. 4414/2016). For that reason, the conclusion of Operating Support Contracts (FiP) for wind power plants ≥6MW and other RES plants ≥1MW is on hold until a tender is announced (art.28 par.2 Law No.4447/2016).

Eligibility period

The duration of Operating Support Contracts is 20 years, with the exemption of CSP plants (art.3 par.6 Law No.4414/2016).

Distribution of costs

State

The feed-in premium is paid out from the “Special Account for RES and CHP”. The revenue of this Account is acquired through trading GHG emission allowances (art.143 par.3b Law No.4001/2011).

Consumers

The costs of the feed-in premium system are borne by the consumers, who are obliged to pay a "Special Tax for the Reduction of Greenhouse Gases", which is added to their electricity bills (art. 40 par. 3c Law No. 2773/1999). The tax depends on the consumer category, is revised twice a year by the Regulatory Authority for Energy and varies from € 2.47- €26.08 per MWh (RAE Decision 1101/2017 in conjunction with art. 143 Par. 3a Law No.4001/2011).

Plant operator

Plant operators and electricity suppliers pay fees for the “Day Ahead Scheduling” as well as the sums that might emerge from Imbalance Settlement (art.143 par.3a Law No.4001/2011).

Distribution mechanism

Former LAGIE- DAPEEP (RES and Guarantees of Origin Regulator) pays out the foreseen support through a “Special Account for RES and CHP) (Art. 40 Par. 3c Law No. 2773/1999 in conjunction with Art. 1 Min Res /F1/oik.17149 in conjunction with Art. 143 Par.2 Law No.4001/2011).

The “Special Account for RES and CHP” is divided in two basic categories:

“Special Account for RES and CHP for the Transmission System” and

“Special Account for RES and CHP for non-interconnected system”.

“Special Account for RES and CHP for the Transmission System” is further divided into subaccounts:

1. “Subaccount of Electricity Market”, whose revenues are (art.143 par.3a Law No.4001/2011):

  • Fees plant operators and electricity suppliers pay for the “Day Ahead Scheduling” as well as the sums that might emerge from Imbalance Settlement; 
  • Revenues derived from Load Representatives for the electricity purchased in the wholesale electricity market; 
  • Any new charges imposed by the Ministry of Environment and Energy since 2018 on Load Representatives.

2. “Subaccount of Support”, whose revenues include (art.143 par.3b Law No.4001/2011): 

  • The costs of the feed-in tariff system are borne by the consumers, who are obliged to pay a "Special Tax for the Reduction of Greenhouse Gases", which is added to their electricity bills (art. 40 par. 3c Law No. 2773/1999). The tax depends on the consumer category, is revised twice a year by the Regulatory Authority for Energy and varies from € 2.47 to 26.08 per MWh (RAE Decision 1101/2017 in conjunction with art. 143 Par. 2c Law No.4001/2011); 
  • Any revenue that is acquired through the auction of GHG emission rights constitutes revenue of the “Special Account for RES and CHP” with which the feed-in tariff is paid out; 
  • a “Special Levy on Lignite” Lignite plant operators are obliged to pay that amounts to €2 per MWh; 
  • the surplus of “Special Account for RES and CHP for non-interconnected system”; 
  • any other charges foreseen by law.

Similar categorization is foreseen for “Special Account for RES and CHP for non-interconnected system” (art.143 par.4 Law No.4001/2011).

Greece

Further information

  • Ανεξάρτητος Διαχειριστής Μεταφοράς Ενέργειας- Independent Power Transmission Operator (ADMIE)
  • +30-210-5192101
  • ADMIE website
  • Info(at)admie.gr
  • Δημόσια Επιχείρηση Ηλεκτρισμού- Public Power Corporation S.A. (PPC) - electric utility company
  • Dimitris Venetidis
  • +30 210 523 77 18
  • PPC website
  • info(at)dei.com.gr