Serbian state-owned electricity producer Elektroprivreda Srbije said it would purchase the output from the Vetrozelena wind park and assume balancing responsibility. It also signed a contract on the payment of market premiums with the project firm.
The contracts that EPS and Vetrozelena signed today are the first ones based on the results of Serbia’s first auctions for awarding premiums. The project’s special purpose vehicle or SPV is owned by PowerChina and CWP Europe.
Vetrozelena, envisaged with 291 MW in capacity, is one of the four projects that fulfilled the 400 MW quota at the first wind power auction. The project won the right to premiums for 210 MW.
EPS’s Živković: Power price, balancing costs were determined on market principles
EPS said that after the completion of the Vetrozelena wind park, expected to be connected to the grid in late 2025, it would offtake the facility’s entire output. Acting Director Dušan Živković signed the contracts with the heads of Vetrozelena Qitao Gao and Maja Turković.
The acting CEO said deals confirm that EPS is a reliable partner for green energy investors.
“The purchase and balancing prices were determined according to market principles which will allow EPS to continue the process of commercializing the company but also enable additional profit,” Živković stated.
By purchasing electricity from renewable sources, EPS is increasing the share of green energy in its portfolio, which is important for the energy transition and the introduction of “ecological taxes on electricity production,” he added.
Đedović Handanović: All electricity from the projects that won the premiums will be supplied to our citizens instead of exported
Minister of Mining and Energy Dubravka Đedović Handanović stressed that Vetrozelena is the first of nine renewable electricity plants in the market premium mechanism and the largest one to which the incentives were awarded.
The wind power plant, as she put it, will produce electricity for 180,000 citizens, at the lowest price achieved in the auction – EUR 64.48 per MWh. The minister said it is almost two times lower than the current market price.
“The contracts signed today are an example for other projects as well, as all the electricity produced will be used to supply our citizens rather than for exports,” Đedović Handanović asserted.
Government counts on EUR 12 million to EUR 28 million in annual income from auctions
Đedović Handanović noted that one year ago the regulatory framework wasn’t adequate for stimulating investments in wind and solar power capacities and that it didn’t provide certainty in balancing for investors. Due to the changes in the framework, the biggest auctions in the region were successfully completed, she added.
The construction of power plants within the incentives mechanism, in the minister’s words, translates to more than EUR 1 billion in investments together with EUR 12 million to EUR 28 million in additional annual income for the government.
Đedović Handanović pointed out that the market premium system enables incentives for private investments but that EPS is required to be an active participant in the process, with its investments like the Kostolac wind park and solar power plants.