Key indices of electricity sales in the framework of feed-in

By Doris Ross,2014-11-25 19:37
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Key indices of electricity sales in the framework of feed-in

    Key Indices of Electricity Sales in the Framework of Feed-in Obligation in the First Half

    of 2008

The scheme of electricity sales in the framework of feed-in obligation has changed since 1 1January 2008. The public utility balance circle and the KÁP settlement between public utility

    suppliers, and the public utility wholesaler and the system operator ceased to exist. It was replaced by a separate balance circle for power plants generating electricity in the scheme of 2feed-in obligation (hereinafter: the KÁT balance circle). The balance circle manager is the

    Transmission System Operator (MAVIR). The Act LXXXVI of 2007 on Electricity

    (hereinafter: the Electricity Act) orders that traders selling electricity to domestic users (including also universal suppliers), generation licensees selling electricity directly to users and all users who import electricity (hereinafter collectively: KÁT takers) shall take over the electricity settled in the separate balance circle (purchased directly by the Transmission System Operator at administrative prices) based on the contract concluded with the Transmission System Operator in accordance with the provisions of a separate statutory legislation [Governmental Decree 389/2007 (23.12)] in the proportion of the electricity sold to their user(s).

Figure 1 Operational model of the KÁT balance circle

    In the new settlement scheme, electricity in the framework of the feed-in obligation is settled at energy fee (HUF/kWh base). In a given month, settlement prices for electricity falling under feed-in obligation and allocated for KÁT takers are calculated so that the unit price is

     1 KÁP: Money for compensation purpose associating with the obligation feed-in of electricity generated from renewable energy sources, by energy from waste and of co-generated electricity. 2 KÁT: Obligatory feed-in of electricity generated from renewable energy sources, by energy from waste and co-generated electricity in acordance with the order of procedure based on Section (2) of Article 9 of the Electricity Act and the separate legilation on the rules of feed-in obligation.

    the same for each settlement metering interval (each quarter hour) of the actual month. When determining settlement prices, the Transmission System Operator takes into account its due settlements with generators and KÁT takers, its costs incurred in relation with the balancing of the KÁT balance circle, and the cash flow balance of the operation of the KÁT balance circle in the previous month.

    The calculated amount of “subsidy” for the electricity settled at a price that can be regarded as subsidized in the KÁT balance circle (the difference of the effective price and the market-3based base price) was 33 billion HUF in the first half year of 2008. 70% of the total “subsidies”, 24.2 billion HUF, was paid to subsidy co-generated electricity. The amount calculated for electricity generated from renewable energy sources was 8.3 billion HUF, electricity generated from waste was 0.1 billion HUF, while electricity generated by co-firing accounted for 0,4 billion HUF. The calculated amount of “subsidy” increased by 8.7 billion

    HUF (36%) related to the KÁP in the first half of 2007. Within this, the amount calculated for co-generation grew by 7.4 billion HUF (44%), while the amount calculated for electricity generated from renewables rose by 1.3 billion HUF (18%) (See Figure 2)

Figure 2 ’Subsidy’ by categories (billion HUF, %)

    2008. I. félév

    0,01; 0%0,08; 0%

    0,25; 1%0,45; 1%0,99; 3%

    0,10; 0%

    8,30; 25%24,23; 74%6,86; 21%


    SzennyvízgázHulladéklerakóból származó gázVízerőmű


     3 In 2007: administrative public utility wholesale prices; in 2008: prices (excluding ’subsidy’) specified in Section 4 of Annex (renewables and wastes) and Section 3 of Annex (co-generation) to the governmental decree 389/2007 (23.12)

    2007. I. félév0,01; 0%

    0,02; 0%

    0,19; 1%0,45; 2%

    0,51; 2%

    0,00; 0%

    7,01; 29%16,84; 69%6,29; 26%


    SzennyvízgázHulladéklerakóból származó gázVízerőmű


Top-down from left to right:

     st1 half of 2007

    Co-generation; Sewage gas; Wind; Waste+Pump station; Gas from waste deposit; Biomass and biogas; Renewables; Hydro

     st1 half of 2008

    Co-generation; Sewage gas; Wind; Waste+Pump station; Gas from waste deposit; Biomass and biogas; Renewables; Hydro

    The sum of “subsidy” realized in the sales prices of generators was affected by the quantity fed in, the average feed-in prices emerged due to the effective price changes, the reference price for “subsidy” and the quantities sold in the certain zone times. Two thirds of the increment of 8.7 billion HUF can be assigned to the quantitative effect.

    The quantity of electricity sold in the framework of feed-in obligation in the first half of 2008 rose by 26% (640.1 GWh) to 3115.8 GWh compared to the similar period of the previous year. Within this, the growth in co-generated electricity, which accounts for 70% of the total quantity, was larger than the average (34%), while the increase in the electricity generated from renewable energy sources (9%) did not reach the average (See Figure 3). Zone times changed on 1 January 2008, therefore changes by zone times cannot be evaluated directly.

    Figure 3 Sales of electricity settled at “subsidized” price by categories (GWh, %)

    1; 0%2008. I. félév

    7; 0%78; 3%24; 1%

    86; 3%

    9; 0%

    736; 24%2227; 73%609; 20%

    KapcsoltHulladék (Vegyestüzelés hulladék része is)


    Hulladéklerakóból származó gázVízerőmű



    2007. I. félév1; 0%

    2; 0%71; 3%19; 1%

    46; 2%

    0; 0%

    667; 28%600; 25%1662; 69%


    SzennyvízgázHulladéklerakóból származó gázVízerőmű


1st half of 2008

    Co-generation; Renewables; Gas from waste deposit; Wind; Biomass; Waste (incl. waste part

    of co-firing); Sewage; Hydro; Biogas

1st half of 2007

    Co-generation; Sewage; Wind; Waste+Pump station; Gas from waste deposit; Biogas;

    Renewables; Hydro; Biomass

    The sales quantity of electricity generated from biomass did not rise considerably related to the previous period: it grew from 600 GWh to 609 GWh. This can be explained by the fact

    that the number (and installed capacity) of sellers in biomass category has not changed

    significantly since February 2007. (The sales of the certain power plants in the first half of 2008 certainly do not always equal the sales in the first half of 2007.)

The quantity of electricity sold by wind power plants almost doubled (an 88% increase)

    by 2008. The shift can be explained unanimously by the increasing installed capacity of wind power plants: the working capacity of wind power plants grew to 102 MW from 53.7 MW (in the first half of 2008 near 50 MW wind power plant capacity entered the system).

Hydro power plants below 5 MW with subsidized price- sold 24% more electricity than in

    the previous period, which is primarily due to the local weather conditions (relatively even distribution of rainfalls on the catchment area). The capacity of these power plants increased by approximately 10% in the period under review (by 1.5 MW to 13.5 MW), however the generation of the newcomer Kenyeri Hydro Power Plant is not significant for the time being.

Within the category of renewables, the sales of electricity deriving from gas from waste

    deposit and sewage treatment facilities grew purely by 8 GWh, however, the ratio of

    the increase was more than the average of renewables in both subcategories. The main reason for this spectaculuous shift was the entry of new capacities of 1.7 MW in the former and 1.2 MW in the latter subcategories. Finally, the total installed capacity of these two subcategories exceeded 4 MW. A smaller part of this installed capacity is effectively new capacity, and the bigger part comes from the reclassified power plants that earlier were included in the biomass category, but basically belong to this one.

    Statutory provisions effective since 1 January 2008 introduced a new category of electricity generated by co-firing (waste and fossil, renewable and fossil). In the first half of 2008, 66 GWh electricity was generated in this category (including 62 GWh from waste category and the remaining from biomass category). The sales of electricity that clearly associated with waste accounted for approximately 16 GWh in the observed period.

In the first half of 2008, the volume of co-generated electricity sold at “subsidized” price

    in the framework of feed-in obligation rose by 34% relative to the same period of the previous year. 15% of the increment derives from the increasing generation of co-generated facilities also operating in the previous period, while 84% comes from the generation of new units of total capacity of 183 MW. 80% of the sales of new (and returning respectively) units comes from two large power plants representing a capacity of 142 MW (Nyíregyháza and Debrecen Combined Cycle Power Plants), while the remaining part derived from the generation of six gas turbine units of capacity below 20 MW.

With regard to the sales of the first half of 2008, the value of ’subsidy’ – calculated as the

    difference of the ’subsidized’ and the ’non-subsidized’ price – (earlier KÁP) projected to 1

    kWh electricity sold (’specific subsidy) increased 10.59 HUF/kWh by 7.8% relative to

    the same period of the previous year. On the one hand, this increase derived from the fact that the reference price taken into account for the calculation of the ’effective subsidy’ (the

    average price excluding any subsidy) rose to a smaller extent (by 5.4%), than the average feed-in price (by 6.4%), on the other hand, the changes in zone times and accordingly the changes in sales resulted in a significant shift in the weighting applied in average calculation. ’Specific subsidy’ was 10.28 HUF/kWh in the category of renewables, 10.88

    HUF/kWh in co-generation, which are 8.7% and 7.3% higher, respectively, relative to the same period of the previous year.

    Figures of sales and the associating ’subsidy’ by categories are shown in Table 1.

Table 1 Electricity sold in the framework of feed-in obligation and the amount of the

    associating KÁP/’subsidy

    Generation of subsidized electricity under feed-in obligation

    Electricity fed in Subsidy Specific subsidy

    1st half of 1st half of 1st half of 1st half of 1st half 1st half Categories 2007 2008 2008/2007 2007 2008 2008/2007 of 2007 of 2008

    GWh % Billion HUF % HUF/kWh Renewables, total 667.26 736.36 10% 7 010 8 301 18% 9.46 10.28 Incl:

     Biomass 600.06 608.86 1% 6 286 6 862 9% 10.48 11.27

     Biogas 9.44 102 10.81

     Wind power plant 45.61 85.93 88% 507 994 96% 11.12 11.57

    Hydro power

    plant below 5

     MW 19.14 23.73 24% 191 252 32% 9.96 10.61

    Gas from waste

     deposit 1.70 7.36 333% 18 80 338% 10.77 10.88

     Sewage gas 0.76 0.90 20% 8 10 25% 10.97 11.44 Waste 69.25 15.67 435 110 6.28 7 Co-firing 65.86 362 5.5 Gas pump station 1.89 19 12 7.93 Co-generated 1 661.64 2 227.10 34% 16 829 24 225 44% 10.13 10.88 Total 2 400.0 3 041.2 27% 24 303 32 977 36% 9.82 10.60 Hydro not falling under

    KÁP 73.9 71.0 -4% Source:KÁP/KÁT register of Department for Electricity Price Preparation, HEO

Remark: The published data are cumulated from data supplied by the licensees. Neither the

    individual nor the aggregate data can be considered ’final’ and ’justified’ by the HEO.

Compiled by:

    Tamás Tóth,

    Ferenc Csikós

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