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A new tender for renewable energy support has been published in Hungary

The Hungarian Energy and Public Utility Regulatory Authority has published the 2020 green premium tender. Power plants producing electricity from renewable energy sources will be able to apply for price support this autumn for a period of 15 years.

General conditions of the 2020 green premium tender 

The tender is open to business associations established in a Member State of the EU, EEA or the Energy Community, or having registered seat, branch or permanent establishment in Hungary and local governments. Tenders may be submitted for a for power plant units generating electricity from renewable sources which is new or is the result of a significant investment or has undergone a reconstruction or development costing more than 50% of the original initial investment value. A feasibility study must be prepared this year as well for a reconstructed or developed power plant, the detailed mandatory content elements of which are included in the tender documentation. 

Support can only be obtained with documentation planning electricity generation at a site in Hungary. The application can be submitted electronically, through a client portal, a company portal or an office portal, in Hungarian. Overall, the general terms and conditions of the application are essentially unchanged compared to the 2019 green premium application.

The tender framework of the green premium tender has changed, the performance limit has increased

Renewable energy power plants subject to the green premium tender have again been classified into two categories. Power plant units with a nominal capacity of more than 0.3 MW but less than 1 MW and with a capacity of 1 MW or more but not more than 49.99 MW. The ceiling for higher-capacity power units has increased significantly compared to last year's tender, in which the maximum capacity was 20 MW. 

The total amount of green premium support that can be allocated has decreased, the limit of the eligibility that can be allocated based on an application is HUF 800 million per year of new support and 390 GWh/year of subsidized electricity. 

The total amount of support was divided between the two categories such that in the category of smaller power plants the new annual support limit is HUF 200 million and the limit of the amount of subsidised electricity that can be allocated is 40 GWh/year, while in the larger category it is HUF 600 million and 350 GWh/year.  

The maximum amount of subsidised electricity that can be obtained by applicants belonging to the same beneficial owner has been limited, in the tender category of power plants with a nominal capacity in the smaller category this limit is 15 GWh/year, while in the case of the larger category it is 175 GWh/year.

The tenderer submits a tender for the tender price, the aim of the tender procedure is to select the tenders with the lowest need for support. The highest tender price that can be validly submitted by a tenderer is 26.70 HUF/kWh.

The support period is 15 years, which period shall be reduced in accordance with the tender notice in the case of support other than the premium-type support. 

The deadline for submitting the green premium tender is the 15th of October 

The tender submission period is from 00:00 hours on 15 September 2020 to 23:59 hours on 15 October 2020, during which time a tender can be validly submitted. 

For one site, only one tender documentation may be accepted as the winner, one tender documentation may relate to only one power plant unit and one tenderer may submit only one tender for one power plant unit (in the case of several tenders, the latest one submitted will be accepted). Except in the case of request for additional information, the tender may not be modified, but may be withdrawn by the submission deadline.

After the submission, the IT system of Hungarian Energy and Public Utility Regulatory Authority (HEPURA) checks whether the documentation has been received without damage and notifies the tenderer in a message within a maximum of 1 working day from the receipt. If the tenderer receives a message about the damaged nature of the mailed item, they must repeat the submission within 24 hours, in the case of which the tender is considered to have been submitted within the original deadline. 

The tender price must be indicated in the opening document, which must be encrypted with the specified notarial certificate and submitted as a separate attachment using the Microsec e-signature program. 

Tender security - tenders shall contain a bank guarantee

The amount of the tender security is the nominal capacity of the power plant unit, 1.5 percent of the investment amount calculated on the basis of the result of multiplication of the specific benchmark investment value provided for in the tender. The tender security must be valid and effective from the date of the submission deadline for at least 8 months after the submission deadline. 

The tender security must be provided in the form of a bank guarantee, but its system of formal requirements is significantly more stringent than in the previous tender: there are two mandatory models to choose from contained in the tender by which the availability of the guarantee can be proven. Failure to provide a certificate accordingly will render the bid invalid. 

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Opening and evaluation of the Hungarian green premium tender

The evaluation is carried out by a five-member Evaluation Committee. Tenders will be opened on the third day following the deadline for submission, then, HEPURA issues a notice on the tender data on the basis of the minutes on opening. 

Within 45 days of the submission deadline, all tenders will be examined by the committee both in relation to the tender and the tenderer's eligibility. If the documentation does not fully contain the required data and documents, the tenderer may be called upon to rectify the deficiencies at most once within a period of 15 days. Neither the information on the tender price nor the tender security can be submitted additionally, their incompleteness or error will result in invalidity. 

Within 20 days of the expiry of the deadline for the supply of additional information, the Evaluation Committee will make a Summary Evaluation, describing the tenderers' compliance with the tender conditions or the reasons for invalidity or rejection, and establish the order of the valid documentations by tender category and proposes the tenders to be declared successful, partially successful or invalid, or to be rejected.

HEPURA will publish a notice regarding whether the tender procedure is successful or invalid within 5 working days after the preparation of the Summary Evaluation. In case of a successful tender, within 15 working days thereafter, HEPURA will record the success, invalidity or rejection of the tenders submitted in individual ex officio resolutions. 

In the case of successful tenders, the decision shall include a deadline for the start of commercial operation, which shall be 3 years from the date on which the decision establishing entitlement to the support becomes final for all tenderers. 

Information and questions 

Questions related to the tender notice can be addressed to HEPURA by phone and e-mail. A summary of the answers to the most significant and repeated questions received in connection with the tender will be available also on the HEPURA website. 

The announcement of the 2020 green premium tender contains clarification and detailing rules in several places compared to the previous tender. However, especially given that the fundamentals of the tendering system have not changed, the questions asked in the previous tender can also be a useful point of reference.

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Official source for tender info:
Green premium tender
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