Tender based premium scheme
Updated: 07.01.2019
Author: Karl Wikberg
The Act No. 1396/2010 has been amended by Act No. 441/2018. The changes includes a legal framework for opening up the market for production of renewable electricity with a new tender- based premium scheme. The regulating authority is the Energy Agency opened up the first tendering round in autumn 2018 from 15 of November to 31 of December. The purpose of the tendering scheme is to promote production of electricity through renewable resources. The tenders up for offer will be 1.4 TWh annually. The instructions for the tenders are given by the Energy Authority in the document Preparation for the participation in tender for renewable energy No. 1595/702/2018.
Eligible technologies
The tender based premium scheme is a support scheme to promote cost effective development of renewable energy in Finland. The scheme is technology neutral for new producers of electricity from wind, solar, biogas, biomass wood fuels and wave power (§5 Act No. 1396/2010).
The premium offered is capped at € 53.5 MWh (§ 32 Act No. 1396/2010), this is the target price € 83.5 MWh (§ 23 Act No. 1396/2010) minus the base price of € 30 per MWh (§ 25 Act No. 1396/2010). The market price is determined in yearly quarters according to (§ 2 Decree No. 1397/2010). The premium offered is market based sliding FiP.
| Wind energy | Eligible |
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| Solar energy | Eligible |
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| Biogas | Eligible |
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| Hydro-power | Wave energy, eligible |
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| Biomass | Eligible |
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Addressees
Entitled party. New producers of wind, solar, biogas, biomass and wave power for the generation of electricity in Finland (§ 7 Act No. 1396/2010).
Obligated party. The support system is financed by the state budget and managed by the Ministry of Economic Affairs and Employment and is managed by the Energy Authority (Energiavirasto) (§2, §4 Act No. 1396/2010).
Procedure
Process flow | Energy Agency that is set to open up the first tendering round in autumn 2018 from 15 of November to 31 of December. |
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Competent authority | Energiavirasto (Energy Authority) and the Ministry of Economic Affairs and Employment. |
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Cap
If the energy producer has not fully completed the project, but has connected part of the project and is producing electricity within three years of the accepted bid, a proportionate part of the construction security deposit will be deducted (§ 57 a Act No. 1396/2010). The producer might also be obligated to pay sub capacity compensation if the producer is not able to produce the stated amount of electricity. (§ 36 Act No. 1396/2010)
Eligibility period
The participation security deposit as well as the construction security deposit are motivations to ensure the projects are progressing.
Distribution of costs
| State | The funding for the support comes from the national budget (§ 2 Act No. 1396/2010) |
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| Distribution mechanism | - Eneriavirasto (Energy Authority)
- Ministry of Economic Affairs and Employment.
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Finland
