13 April 2022
WindEurope position on non-price criteria in auctions
The allocation of support schemes to wind is determined by State-run auctions. This is a requirement under the EU Renewable Energy Directive (Article 4) and the EU State aid policy. It has been a long-standing practice in EU and national regulations that auction winners are decided solely on the basis of the price they offer for procuring electricity – the so-called ‘price-only’ rule where the cheapest bid wins. However, more and more EU Governments have been and continue experimenting with non-price criteria in their auction design, notably in offshore wind. And the new EU State aid rules, applicable as of January 2022, allow EU Member States to rank the bids in an auction with non-price criteria for up to 30% of the total score should they wish to do so.
This paper sets out the initial views of the European wind industry on the design of non-price criteria in auctions that can best support the EU’s long-term decarbonisation goals and the short-term objectives of decreasing Europe’s independence on Russian fossil fuels through renewables “made in Europe”.
We recommend that non-price criteria in wind energy auctions:
- Complement, but do not duplicate, existing policy instruments
- Are clear, objective, comparable, easy to assess / measure / monitor
- Do not create additional administrative or management costs
- Build upon the wind industry’s strengths and incentivise incremental innovation
- Are matched up by equal and coordinated policies in adjacent economic sectors and supply chains
- Prioritise three categories of criteria:
- Sustainability & Biodiversity
- System integration & Innovation
- European supply chain development & benefits to communities
