The Government of Serbia adopted the Plan for the incentive system for the use of renewable energy sources for the period 2023-2025. The plan is focused on the technologies of electricity generation from wind farms and electricity generation from solar power plants.
The plan does not encourage the construction of small hydroelectric power plants in the three-year period, due to, as stated in the explanation, challenges related to the issue of their environmental acceptability.
The total capacity for which the right to receive incentives in the market premium system over the next three years is 1,000 MW for wind power technology and 300 MW for solar power technology.
First auctions in the second quarter of 2023. It is planned that the first auctions for awarding the market premium will be held in the second quarter of 2023 for 400 MW of wind power capacity and 50 MW of solar power power capacity.
The next auctions for the allocation of the market premium will be held in the first quarter of 2024, where the auction quota will be 300 MW for wind power plants and 100 MW for solar power plants, and in the first quarter of 2025, where the auction quota will be 300 MW for wind power plants and 150 MW MW for solar power plants.
The first auctions this year will be conducted in a classic and simpler form, where incentives are awarded based on the financial offer. The plan, as stated, is for future auctions to include other criteria, such as the willingness of producers to offer electricity to a guaranteed supplier for the needs of guaranteed supply to households and small customers or to another end customer through a direct contract on the purchase of renewable energy sources, which will ensure that users incentives sell electricity in Serbia for the needs of citizens and businesses.
Taking into account the time period between the execution of the auction and the commissioning of the production capacity for which the right to incentives is acquired at the auction, which is specific for each type of technology, in the following period of three years, it is expected that in the first quarter of 2025 will be put into operation the capacity of solar power plants that will be eligible for incentives at the first auction (50 MW), while in the fourth quarter of 2025 it is expected that most of the capacity of wind power plants that will be eligible for incentives at the first auction will be put into operation (300 MW ), as well as most of the capacities of solar power plants that will be eligible for incentives at the second auction (50 MW) – it is stated.
Biogas power plants are not included in the Plan because feed-in tariffs are currently reserved for 68.26 MW, which are expected to be implemented by the end of 2025, which in case of implementation with the existing capacity of 28.48 MW will provide almost 100 MW of capacity from this technology.
This, as stated, is more than enough considering that currently the feed-in tariff for electricity produced in biogas power plants is very high and amounts to 200 €/MWh, so additional encouragement of biogas power plants could lead to an excessive load on the incentive system.
The plan does not envisage auctions for other technologies such as biomass power plants, geothermal and other power plants, bearing in mind that there are no projects that would make the process competitive.
