The Government has published the Terms and Conditions (“The Terms and Conditions“), Timetable and Qualification Information Pack for the RESS 3 auction.
This will be the third onshore auction run by the Government under the Renewable Electricity Support Scheme (RESS). Stakeholders will immediately note several key differences to the RESS 1 and RESS 2 terms and conditions.
Prospective applicants should keep well abreast of the below timetable. Auction qualification will dominate the months of May and June before bids are made in September. Preliminary results will be announced in late September followed by final results in October.
| Qualification | Qualification Application Opening | 30 May 2023 |
| Qualification Application Closing | 14 June 2023 | |
| Provisional Qualification Decision date | 9 August 2023 | |
| Final Qualification Decision date | 1 September 2023 | |
| Auction | Auction Information Pack Publication Date | 4 September 2023 |
| Auction Submission Opening Date | 8 September 2023 | |
| Auction Submission Closing Date | 15 September 2023 | |
| Results
|
Provisional Auction Results Date | 26 September 2023 |
| Final Auction Results Date | 9 October 2023 |
RESS 3 Terms and Conditions
The new Terms and Conditions provide a number of notable departures from the principles that have governed previous RESS auctions.
Most notably, RESS 3 will provide for Unrealised Available Energy Compensation (“UAEC”). These compensation payments act as substitutes for curtailment compensation arrangements (“CCA”) provided for under RESS 1 and RESS 2.
The UAEC is intended to de-risk a RESS 3 project’s exposure to regulatory risk, specifically by enabling support to be provided on the basis of a quantity closer to energy availability rather than energy actually produced. To that end compensation is provided at the strike price applicable to each RESS project for availability not converted to generation for reasons of either curtailment or oversupply.
The UAEC does not, however, extend to compensation for constraints, as transmission constraints remain an important locational signal for project developments.
The Terms and Conditions have also provided for indexation which will apply to 30% of a successful project’s strike price in line with the Harmonised Index of Consumer Prices. This will be a welcome departure from RESS 1 and RESS 2 terms and conditions where the absence of indexation was a dominant line of criticism.
Successful projects may request to withdraw from RESS 3 by giving at least 12 months prior written notice. The Government had initially considered requiring RESS 3 projects to remain within the PSO (Public Service Obligation) Levy payment structure for the entirety of the RESS Support term, however this has not been reflected in the final Terms and Conditions.
Prospective participants in the RESS 3 auction are reminded that the qualification application closing date is 14 June 2023.
For further information on participation in the RESS 3 auction or further state energy support schemes, please contact a member of our Energy, Renewables and Utilities department.
Contributed by James Curtis
