The draft Order alters a key parameter in the formula used to
calculate the "banding factor". The banding factor sets
the number of Renewable Energy Certificates ("RECs") a
renewable energy project receives for each kWh of electricity
generated from renewable energy sources. Each REC can be sold at a
guaranteed price of EUR 93/REC. The banding factor thus effectively
determines the subsidy level.
The proposed amendment reduces the parameter reflecting the
yield of the investment, namely "parameter R".
The proposed reduction applies to all green electricity
projects, regardless of size or technology, though with different
effective dates. For projects requiring an individual application
for a project-specific banding factor, the reduced parameter R
applies to projects for which that individual application occurred
as of 1 January 2020. For other projects, the reduced parameter R
applies for those projects having a starting date as of 1 April
2020.
