President Andrzej Duda signed a law on price differentiation in offshore auctions

President Andrzej Duda has signed an amendment to the Act on Promoting Electricity Generation in Offshore Wind Farms, the President’s Office said on Tuesday. The act allows for the differentiation of maximum prices in auctions for offshore projects.

According to the act, the minister responsible for climate may by regulation set different maximum prices for the phase II offshore auctions for individual areas designated for the construction of offshore wind farms, taking into account their geophysical conditions or distance from the shore. The law is expected to enter into force the day after publication.

On Monday, the climate ministry already presented a draft regulation proposing two maximum prices in shares for offshore wind farms, depending on their location in the Baltic Sea. The prices are 479.10 for areas closer to the shore and 512.32 PLN per MWh net for areas further away.

The higher price would apply to five areas for wind farms located at a distance of 75 km from the Polish Baltic coast. The lower price would apply to eight areas located roughly half as far.

The possibility of differentiating this price was justified by the fact that the areas for wind farms in phase II of offshore development are differentiated, among other things, in terms of geophysics or distance from the shore, which is important from the point of view of construction and subsequent operation costs.

If a single maximum price is set for all projects, which are highly differentiated, it is highly likely that projects from higher cost areas will not enter the auction and some projects will not be built, the impact assessment pointed out.

Phase II auctions for offshore development, during which the right to so-called negative balance coverage may be granted, have been scheduled for 2025, 2027, 2029 and 2031 and are expected to allow 4 GW, 4 GW, 2 GW and 2 GW of offshore wind capacity respectively.

Source: PortalMorski.pl