In the dynamic world of renewables, Governments show strong ambitions to fight climate change and lead energy transition via notably Carbon Neutrality pledges by the next decades. These agenda translate into targets in term of RES share in national power capacity mix and final consumption to achieve. Thus, staged planning of new RES capacity development or existing RES upgrading are set out by the public authorities to set the course in the national RES strategy.
In the renewable market, public authorities are playing a major role as energy regulator enabling RES technologies to compete with incumbent fossil and nuclear technologies. As recent technologies supported by national energy strategies, RES capacity development has been et is still being subsidized by the Governments. Success in renewables is indissociable from public subsidy policies and remuneration schemes, such as the feed-in-tariffs and feed-in-premiums mechanisms.
Observing the significant fall in RES technologies costs (e.g. LCOE) over the past decade, Governments tend to rely more on market-based support instruments to reduce public-funded subsidies and let market and competition decide on RES prices and related revenues. Thus, Governments with the experience in other infrastructure fields such as the telecommunications are increasingly implementing competitive bidding procedures or auctions to offer a pre-determined RES volume of which prices are determined from the most competitive bids given by auction’s participants or bidders. RES auctions do not necessary exclude public support policies as the winning bids determine the level of prices often associated with a remuneration scheme, such as a feed-in-premium.