Second Half Year 7,325 New and Renewable Energy Sites RPS '2020 Hedging'... 'Carbon Bonus Points' Awarded

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[Asia Economy Reporter Moon Chaeseok] The Korea Energy Agency announced on the 13th that 7,325 sites were selected in the second half fixed-price competitive bidding for the Renewable Portfolio Standard (RPS) 20-year fixed contracts. A record high of 1,410 MW was allocated, and the capacity segments were further subdivided.

The RPS fixed-price contract competitive bidding system is implemented to reduce the volatility of the System Marginal Price (SMP) and create a stable investment environment for project operators.

According to the Energy Agency, in the second half bidding, the existing mid-scale operator segment of 'over 100 kW to under 1 MW' was subdivided based on 500 kW.

The bidding was divided by capacity into ▲under 100 kW (494 MW selected) ▲100 kW to under 500 kW (496 MW) ▲500 kW to under 1 MW (346 MW) ▲1 MW and above (80 MW). Small-scale operators were considered by allocating 35% of the total capacity to under 100 kW. As a result, the overall average competition ratio was recorded as 3:3:1.

The average winning bid prices by capacity were set at ▲under 100 kW 156,223 KRW/MWh ▲100 kW to under 500 kW 134,731 KRW/MWh ▲500 kW to under 1 MW 137,843 KRW/MWh ▲1 MW and above 139,405 KRW/MWh. The average selected price was 143,682 KRW/MWh.

In the second half, among power plants using carbon emission verified products totaling 737.5 MW, 400 MW received the 20-year RPS hedging opportunity. Carbon emissions of 670 kg CO2 per kW or less were awarded 10 points. ▲Over 670 kg CO2/kW to 830 kg CO2/kW or less received 4 points ▲Over 830 kg CO2/kW (or unverified carbon emissions) received 1 point each.

By capacity, the figures were ▲under 100 kW 54 MW ▲100 kW to under 500 kW 116 MW ▲500 kW to under 1 MW 178 MW ▲1 MW and above 52 MW.

Selected operators through this bidding must sign a 20-year supply certificate sales contract with the obligated suppliers (six companies: Korea South-East Power, Korea Hydro & Nuclear Power, Korea Southern Power, Korea East-West Power, Korea Western Power, Korea Midland Power) within one month from the selection allocation date. Failure to sign the contract within the deadline may result in cancellation.

Lee Sang-hoon, head of the New and Renewable Energy Center at the Korea Energy Agency, said, "As the volume of fixed-price contract competitive bidding continues to increase, we expect continuous interest and active participation from power producers in the future."

He added, "Through the carbon emission verified product evaluation index introduced for the first time in this bidding, we have created conditions to further strengthen the competitiveness of the domestic solar power industry by expanding the use of low-carbon eco-friendly products."

The bidding selection results can be checked by logging into the 'RPS Fixed-Price Contract Competitive Bidding System' with the operator number and digital certificate to view by power plant.

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