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May 2020

Apr

Lack of headroom in RESS will see projects jostle for limited capacity

Charlotte Nelson
charlotte.nelson
14 February 2020

The upcoming Renewable Energy Support Scheme (RESS) has caused excitement across the industry and with between 1000GWh – 3000GWh available, the competition could be high. A key feature of the design for the RESS auctions is the carve-outs or “preference category” for several key areas: community projects, solar projects and all other projects.

Analysis from Cornwall Insight Ireland shows what impact the preference category carve-outs mean for participants. With just 30GWh available to community projects, equating to just under 10MW of wind capacity the entire pot could be taken up by two small projects of 5MW each.

If the solar and community preference categories take up their full allocation, this could leave the rest of the renewable industry battling it out over as little as 670GWh, in a worst-case scenario.

James Goldsmith, Senior Consultant at Cornwall Insight Ireland, said:

“The merits for splitting up the bid stack into different preference areas could be disputed, but the principle has been shown to be effective in other renewable subsidy schemes across Europe. For community-led projects, the preference category is to be welcomed, but the lack of headroom within it means that it could be extremely challenging to walk away with a contract from the RESS auctions.

“The lack of auction headroom for projects won’t just impact on the community developers, with the ‘all projects’ group also jostling for limited capacity. The worst-case scenario for the renewable industry would leave 670GWh available in the auction if the solar and community projects take up their full allocation. This sounds reasonably high on the face of it; however, it does only equate to about 196MW of installed wind capacity.

“If the auction settles towards the lower end of the available volumes, the prospect of all the capacity being taken by a small number of projects exists. If this occurs, and only 1000GWh of volume is successful in the auction the all project category could be taken by just a couple of projects.

“While the prospect of RESS starting is great news for the renewable industry as a whole in Ireland. The outcome of the results might leave a lot of companies hungry for more and quickly.”

–Ends

Notes to Editors

For more information, please contact: Charlotte Nelson at c.nelson@cornwall-insight.com or 01603 542 121

To link to our website, please use: https://www.cornwall-insight.ie/

About Cornwall Insight

Cornwall Insight is the pre-eminent provider of research, analysis, consulting and training to businesses and stakeholders engaged in the Great British, Northern Irish and Irish energy markets. To support our customers, we leverage a powerful combination of analytical capability, a detailed appreciation of regulation codes, and policy frameworks and a practical understanding of how markets function.

–Ends

Route to RESS

Given the high level of competition anticipated in the RESS-1 auction, a thorough understanding of the auction process is essential. With that in mind, Cornwall Insight Ireland has developed “Route to RESS”, a package of services and products to deploy our insight and help participants navigate through the auction process.  We will be kicking off with our Qualification Forum. This is an independent industry platform to exchange views and discuss common issues and concerns relating to RESS prequalification and provide access to our experts. For more information, please contact Ruth Young r.young@cornwall-insight.ie

 

 

 

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