The government originally proposed encouraging players in the renewable energy market by paying premiums. In 2007, amendments to the Electricity Act introduced a “premium system” as the main aid mechanism. The scheme provided that a specific premium on the price of equilibrium energy in the wholesale electricity and capacity market would be paid to renewable energy project providers. However, this mechanism has not worked in practice due to some legal and technical problems and the potential impact on end-customer prices. A first step for potential market participants would be to comply with the rules for wholesale electricity and capacity exchanges, established by Decree 1172. Participants are required to enter into a wholesale electricity and capacity contract and to acquire members of the not-for-profit partnership association, the Market Council. A binding form of accession treaty is approved by law and cannot be renegotiated or amended by market participants. Once the accession treaty is concluded, the trader is considered to be a participant in the wholesale capacity market. As has already been said, almost all of the capabilities sought have already been tendered. From November to December 2020, the additional 180 MW will be auctioned for wind turbines, 478.6 MW for solar power plants and 42 MW for small hydropower plants, which will be commissioned in 2023 and 2024. However, an official notice has not yet been issued. The supply of capacity generated by renewable energy sources is one of the mechanisms used in the wholesale capacity market. As noted above, this mechanism is structured by the capacity supply agreements concluded in the context of tenders for the selection of investment projects in the affected areas.
However, it is likely that, subject to certain changes, the existing capacity supply regime, which will be implemented by Order 449, will apply until 2035. Preliminary estimates assume that resources allocated during this period to support investment projects in the renewable energy sector are expected to reach about RUB 400 billion and that new capacity is expected to reach 10 GW. However, the exact quantities have yet to be determined. As has already been said, as indicated in a communication from the market council, approximately 95% of the targeted capacity has already been allocated to different market players in early 2020. The allocated capacity was divided mainly between wind and solar projects. The market is still waiting for new rules for the post-2024 period. There are currently uncertainties about future support for the renewable energy sector after the current incentives expire. The main mechanism, under Decree 449, to promote the use of renewable energy is the conclusion of long-term energy supply agreements with renewable energy operators.