RED, Renewable Policy Updated, Issue 11, 17 November 2016

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Renewable Policy Update

Based on the following sources: Biofuels Digest, Bloomberg, BMUB, BNAmericas, BNEF, CENACE, China’s National Energy Administration, Cleantechnica, CMS Law, ENDS, Gov.uk, Greentech Media, Gulf News, IEA China Desk, IEA Press Intelligence, International Business Times, International Law Office (ILO),

Lexology, Malta Today, Photon, PV Magazine, Recharge News, Renewable Energy World, Reuters, SeeNews Renewables, Trade Arabia, The Standard, UNFCCC, Wind Power Monthly,

Contents

Policy highlight: China’s 13th Electricity Development Five Year Plan (2016-2020) .................. 2

China released its 13th Electricity Development Five Year Plan (2016-2020) revising down 2020 renewable capacity targets .............................................................................................................................................. 2

Renewable energy auctions ....................................................................................................... 3

UK releases details of the 2nd CfD auction round which is scheduled to take place in April 2017 ................ 3

Vattenfall wins 600 MW Danish offshore wind tender with record-low bid .................................................. 3

Mexico’s second power auction produced three record-low prices for Latin America ................................. 4

Argentina announced the winners of its first renewable capacity auction with wind submitting lowest bids ........................................................................................................................................................................ 5

Argentina gets 2.5 GW of bids in additional renewables tender (RenovAr 1.5) ............................................. 5

India publishes bidding guidelines for its first wind auction .......................................................................... 6

Germany opens first joint solar PV auction with Denmark ............................................................................ 6

Germany plans joint wind and solar auctions as pilot .................................................................................... 7

Offshore wind-power price driven to record low in North Sea by Vattenfall in 350 MW Danish tender ...... 7

Dubai to award 200 MW of CSP tender in Q1 2017 ....................................................................................... 7

Ontario scraps 930 MW renewable energy tender planned earlier this year ................................................ 7

Feed-in/premium tariffs ............................................................................................................ 8

China is looking to cut solar PV FIT ................................................................................................................. 8

Egypt announced second phase of the FIT programme with significantly lower tariff rates ......................... 8

Egyptian authority recovers land from 5 companies that withdrawn to develop solar plants under FIT scheme ............................................................................................................................................................ 9

Recent policy changes ................................................................................................................ 9

OECD ....................................................................................................................................... 9

German renewables surcharge to rise by 8% in 2017 .................................................................................... 9

Portugal mandated a retroactive refund of state grants for renewable plants that also benefited from FIT support ........................................................................................................................................................... 9

France’s onshore support mechanism declared illegal by EC ....................................................................... 10

EC approves Greek support scheme for renewable electricity and cogeneration ....................................... 10

Government of Alberta aims to become 50% PV powered .......................................................................... 10

NYC targets 100 MWh energy storage by 2020; ramps up solar activity ..................................................... 11

Non-OECD ............................................................................................................................. 11

Kenya is debating replacing its feed-in tariff system with competitive auctions ......................................... 11

Brazil’s BNDES increases support for solar and terminates fossil fuel backing ............................................ 11

Malaysia’s long-awaited B10 to be implemented by year’s end .................................................................. 11

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Philippines plan to limit renewable energy deployment in areas with a grid constraints ........................... 12

Malta’s revised version of NREAP pushes solar PV and heat pumps eliminating wind ................................ 12

Indian state Kerala to tap renewable energy to increase power production ............................................... 12

Climate change policy developments ...................................................................................... 12

The Paris Agreement entered into force on 4 November 2016 ................................................................... 12

Germany adopted Climate Action Plan 2050 setting for the first time climate targets for sectors individually .................................................................................................................................................... 13

Aviation climate agreement reached at ICAO on global carbon offsetting scheme ..................................... 13

Policy highlight: China’s 13th Electricity Development Five Year Plan (2016-2020) China released its 13th Electricity Development Five Year Plan (2016-2020) revising down 2020 renewable capacity targets Date: 7 November 2016 Sources:

NEA’s press conference launching the 13th Electricity Development FYP;

Bloomberg (8 November 2016), China scales back solar, wind ambitions as renewables cool;

IEA China Desk information; Background: On 7

th of November, the Chief Engineer of the National Energy Administration (NEA), HAN Shui, presented

during a press conference China’s 13th Electricity Development Five Year Plan for 2016-2020. The Plan was initially expected to be released in the first half of 2016 and it comes as a sectoial FYP following the release of the overall 13

th FYP on National Economy and Social Development (2016-2020). The latter was released in

March 2016 and outlines wide national policy orientations for the period up to 2020. The Electricity Development FYP outlines the main development direction for China’s electricity sector and includes technology-specific targets, goals for grid expansion, as well as projections for electricity demand growth. Renewable energy targets: The renewable capacity targets for 2020 were lowered in the final version of the Plan in comparison to its earlier drafts. The Solar PV capacity target was lowered by 27% from 150 GW to 110 GW. The CSP target was halved to 5 GW. China’s goal for wind was reduced by 16% from 250 GW to 210 GW (cumulative for onshore and offshore wind). The bioenergy target was maintained at the level of 15 GW. China renewable energy targets evolutions and achievements under the 12th FYP, proposed targets under the 13th FYP and final 13

th FYP targets:

GW

12th FYP 2011-15,

targets by 2015

2015 achievements

China strategic energy plan in

2014, targets by 2020

13th FYP 2016-20 proposal, targets by

2020

13th FYP 2016-20, targets by 2020

Hydropower 290 GW 320 GW 420 GW 330 GW (excluding

PSP) 380 GW (including

40 GW of PSP)

Onshore wind 100 GW 128 GW 200 GW 250 GW 205 GW

Offshore wind 5 GW 1 GW 30 GW N/A 5 GW

Solar PV 34 GW 43 GW 100 GW 150 GW

110 GW (including more than 60 GW of

distributed solar energy systems)

CSP/STE 1 GW 0.02 GW 3 GW 10 GW 5 GW

Bioenergy 13 GW 10.3 GW 30 GW 15 GW 15 GW

Geothermal 0.1 GW 0.03 GW 0.1 GW N/A N/A Source: IEA (2016), MTRMR2016 and IEA China Desk. Note: Unless otherwise mentioned, hydropower targets include both conventional and PSP capacity.

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Renewable energy auctions UK releases details of the 2nd CfD auction round which is scheduled to take place in April 2017 Source: gov.uk Date: 9 November 2016 Additional materials:

Draft budget notice for the 2nd

CFD allocation round available here;

Accompanying Note to the Draft Budget Notice for the Second CFD Allocation Round available here; Background: Following the Electricity Market Reform in the UK, the Contract for Difference (CfD) scheme was introduced in late 2014 with the intention to gradually replace the Renewables Obligation (RO) programme which will be closed to new projects on 1

st of April 2017. The first CfD allocation auction round opened in late 2014, with

results announced in February 2015 covering projects delivery period until 2018/19. The auction was opened both for “mature” and “less mature technologies”. The first allocation round was followed by a long period of uncertainty over when the second round would be opened and what technologies would be eligible to participate. In March 2016 the government announced that a total budget of GBP 730 million would be distributed via CfD auctions until 2020 for “less mature technologies”. However, no further details were announced about the next auction timeline. On 9

th of November, the Department for Business, Energy & Industrial Strategy (BEIS) of UK released a set of

documents clarifying the rules and conditions for the second Contracts for Difference (CfD) allocation round which is scheduled to take place in April 2017. Auction details: The second CfD allocation round will open in April 2017 for “less established technologies”. Investors will compete for GBP 290 million of support for projects delivered in years 2021/22 and 2022/23. “Less established technologies” are defined as: 1) offshore wind, 2) advanced conversion technologies (with or without CHP), 3) anaerobic digestion (with or without CHP), 4) dedicated biomass with CHP, 5) wave, 6) tidal stream and 7) geothermal. The Administrative Strike Prices applicable to this allocation round are as follow, with actual prices paid likely to be lower:

Technology £/MWh, 2012 prices for projects

deploying in:

2021/22 2022/23

Offshore wind 105 100

Advanced conversion technologies (with or without CHP)

125 115

Anaerobic digestion (with or without CHP)

140 135

Dedicated biomass with CHP 115 115

Wave 310 300

Tidal stream 300 295

Geothermal To be determined up to 10 days before the launch of the allocation

round

A cap of 150 MW was imposed on fuelled technologies (cumulative capacity of projects to be awarded with contracts). There is no referencing to capping any other technology, nor is there any specification for projects of capacity lower than 5 MW. No minimum budget allocation for wave and tidal projects is provided. Final budget and strike prices will be announced up to 10 working days before the commencement date of the auction round. Vattenfall wins 600 MW Danish offshore wind tender with record-low bid Source: renewables.seenews.com Date: 9 November 2016 Vattenfall’s press release available here Vattenfall AB announced that it has won the tender for the construction of the 600-MW Kriegers Flak offshore wind project in Danish waters with a record low bid of EUR 49.9/MWh.

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The Swedish state-owned energy group expects to invest between EUR 1.1 billion and EUR 1.3 billion in the project, pending a final investment decision. The offshore wind park will be built in the Danish portion of the Baltic Sea and, upon completion, will be generating enough power to meet the annual consumption of about 600,000 homes. Vattenfall Wind’s head, Gunnar Groebler, pointed out that the company has now won the three latest offshore wind tenders in Denmark -- the one for Kriegers Flak, the tender for the 406-MW Horns Rev 3 wind park and the 350-MW nearshore wind tender. “Our winning bid for Kriegers Flak is 58% below the original cap of EUR 0.12. For the Danish Near Shore project the bid was also substantially below its cap,” Groebler added. Mexico’s second power auction produced three record-low prices for Latin America Source: BNEF (2016), Mexico’s second power auction results: record low prices in LA, BNEF, London Date: 4 October 2016 Further reading: Summary by CENACE [ES] On 29 April 2016, Mexico’s national system operator Centro Nacional de Control de Energía (CENACE) announced the country’s second power auction, a month after the results of the first tender. The second power auction process ran from May to September. CENACE aimed to contract 1.5 GW of capacity, 10.6 TWh of power and 10.6m clean energy certificates (CELs). The capacity, power and CELs contracted will supply Mexico’s state owned utility Comisión Federal de Electricidad (CFE). The results of the auction were announced at the end of September 2016. Mexico’s second power auction produced three record-low prices for Latin America: an average tender price of USD 33.5/MWh, a wind price of USD 32/MWh and a solar price of USD 27/MWh. Overall, the auction was one of the most competitive in the world, with no winning bid above USD 40/MWh. These prices are driven by high participation, low equipment prices and new wind and solar strategies. The auction contracted 1.2 GW of capacity at an average price of USD 32,286/MW-year, 8.9 TW of power and another 9.3m clean energy certificates (CELs) for a combined average price of USD 33.5/MWh. A total of 19 companies won contracts, with a mix of state-owned and private companies and local and international developers. Among the winning companies are Acciona, Comisión Federal de Electricidad (CFE), Grupo EDF Energies Nouvelles, Enel Green Power, Engie, Ienova (Sempra Energy) and Zuma Energía (Actis). A little over half of the power and certificates contracted will be supplied by 1.9 GW of PV plants and around 40% will come from 1.2 GW of wind farms.

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Argentina announced the winners of its first renewable capacity auction with wind submitting lowest bids Source: Bloomberg Date: 1 October 2016 Additional materials:

YouTube [ES] Summary of the RENOVAR 1st

tender by Ministerio de Energía y Minería de Argentina;

PPT [ES] Summary of the tender names, locations, installed capacities, and developers of each project submitted;

All RenovAr documentation (laws, decrees, call for proposals [ES and EN]) here; Argentina has announced the winners of the RenovAr Ronda 1 renewable energy tender, which offered power purchase agreements (PPAs) for 1 GW of renewable power projects, including 600 MW of wind, 300 MW of solar, 65 MW of biomass, 15 MW of biogas and 20 MW of small hydropower capacity. 123 bids were submitted, for a total capacity of 6,346 MW: the wind capacity was nearly six-time oversubscribed (3,469 MW), while the solar capacity was 9-times oversubscribed (2,813 MW). The government awarded contracts for a total of 1,109MW of projects (17 projects), dominated by 708 MW of wind energy and 400 MW of solar power. Given huge participation and low bidding prices, government decided to hold a second round of auctions (called RenovAr 1.5) in mid-November 2016. Wind was the cheapest source of energy in Argentina’s first power auction after the country implemented reforms designed to transform its fossil fuel-dependent grid. The minimum price for wind power reached USD 49.10/MWh in the auction process. Solar power came in at USD 59/MWh, biomass was USD 110/MWh and hydropower projects were USD 111.10/MWh.

Argentina's RenovAr 1st

round tender – 14 out of 17 winning projects

Technology Winning company Project

capacity Name of the project Province

Average price of awarded

PPA

Onshore wind

Envision 50 MW Cerro Alto Río Negro

USD 59.4/MWh

75 MW Los Meandros Neuquén

50 MW Vientos del Secano Buenos Aires

10 MW García del Río

Central Térmica Loma La Lata, a subsidiary of Pampa Energía

100 MW Corti Buenos Aires

Pan American Energy and 3-Gal

24 MW Garayalde Chubut

Consortium Enat-SEG-Otamendi-Nuevo Cerro Dragón

24 MW Kosten

Eren 97 MW Vientos Los Hércules Santa Cruz

Arauco SAPEM 100 MW Arauco La Rioja

Solar PV

JEMSE 300 MW

1st

,2nd

and 3rd

solar parks (each park 100

MW) Cauchari

USD 59.7/MWh

Fieldfare and Isolux Corsan

100 Mw 4th

solar park Salta

Biogas Martín Bacarato

1.2 MW Ricardone Santa Fe USD

118/MWh Table based on BNAmericas

Argentina gets 2.5 GW of bids in additional renewables tender (RenovAr 1.5) Source: renewables.seenews.com Date: 14 November 2016 MINEM press release available here; The Argentine government has received a total of 47 bids, representing 2,486 MW of wind and solar capacity, for its RenovAR 1.5 tender. When announcing the successful bids under the first tender round of its renewable energy programme RenovAR in October, Argentina launched the additional 1.5 round seeking 600 MW of projects, split between 400 MW of wind and 200 MW of solar. Only projects that failed to secure a power purchase agreement (PPA) in the RenovAR 1.0 tender or which did not qualify for the process were able to take part in the additional

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round. The 47 offers announced by Argentina's energy ministry on Friday include 19 wind projects for 1,561 MW of capacity, most of which proposed for Buenos Aires and Patagonia, and 28 solar projects representing 925 MW. The economic proposals will be opened on November 23 and the successful bids will be announced on November 25. The maximum bidding prices for this round were USD 59.39 (EUR 54.74) per MWh for wind power and USD 59.75 per MWh for solar power, in line with the averages prices achieved in the first round. A total 1,109 MW of projects were awarded contracts under the RenovAR 1.0 tender. These include 12 wind projects or 708 MW of capacity, four solar projects for a combined 400 MW, and one biogas project of 1.2 MW. India publishes bidding guidelines for its first wind auction Source: windpowermonthly.com Date: 15 November 2016 Further reading:

MNRE press release available here;

The guidelines are available here; On 3

rd of November 2016, the Ministry of New and Renewable Energy (MNRE) has released guidelines for up

to 1 GW of wind capacity under a reverse biding mechanism, a first for the country's wind sector. The capacity is to be provided on a BOO (build/own/operate) basis and will be connected to the Inter-state transmission system (ISTS) to enable power transfer across regions. States without good wind resources will be able to procure wind power from other states to meet their non-solar renewable purchase obligation (RPO). Subsequent guideline amendments allow for non-utility bulk consumers to participate as buyers, and a waiver of inter-state transmission charges, seen as an obstacle for wind power purchase across states. The mechanism proposed for this 1 GW procurement allows planned, under construction, and stranded projects (installed assets without power purchase agreements) to make tariff bids for any capacity ranging from 50 MW to 250 MW. Germany opens first joint solar PV auction with Denmark Source: Bundesnetzagentur.de Date: 12 October 2016 Further reading: Press release by BNetzA [EN] Germany’s federal grid agency BNetzA has launched a first cross-border tender for 50MW of PV capacity together with neighbouring Denmark, following up on an earlier co-operation agreement between the two EU member states. The auction is held for a volume of 50 MW of ground-mounted solar PV capacity with a maximum price capped at EUR cents 11.09/kWh. The minimum bid volume shall be 100kW. The maximum bid volume shall be 10 MW. Bidding deadline is 23

November 2016. Auction is open for planned installations located both in Germany and

Denmark.

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Germany plans joint wind and solar auctions as pilot Source: Windpowermonthly.com Date: 2 September 2016 From 2018, German onshore wind and large photovoltaic (PV) projects could compete against each other in joint auctions of 400 MW per year. Described as a pilot plan, the federal economy ministry stresses this does not "in principle" signify changing the points towards "technology neutral" auctions. The auction results "will be evaluated without prejudice and compared with those from auctions for specific technologies." The plan has also been agreed, in principle, under European Union state aid rules. It may simply be a question of time before the specific auction capacities currently reserved for onshore wind – a gross 2.8 GW/year in 2017-2019, and 2.9 GW from 2020 – and solar plants (600 MW/year) in Germany are merged. Currently, onshore wind is beating large solar on price: The average winning bid at the fifth auction for German ground-mounted PV plants, which closed on 1 August 2016, was EUR 72.3/MWh. The maximum bid allowed for onshore wind in the first auction due in 2017 is ERU 70/MWh. Offshore wind-power price driven to record low in North Sea by Vattenfall in 350 MW Danish tender Source: Bloomberg Date: 12 September 2016 Further reading: Vattenfall press release Vattenfall AB won a tender to build two offshore wind farms in the Danish North Sea with a record-breaking bid of EUR 60/MWh. That’s 20% cheaper than the previous record set by Dong Energy A/S in the Netherlands in July. In the tender Vattenfall won the right to build two coastal wind parks, one of 180 MW at Vesterhav Syd and one of 170 MW capacity at Vesterhav Nord. The company’s competitors were Wpd Hofor Danish Offshore Consortium and the European Energy Nearshore Consortium, whose bids were not disclosed. Vattenfall aims to start construction of the plants in 2019. Dubai to award 200 MW of CSP tender in Q1 2017 Source: Renewables.seenews.com Date: 5 October 2016 More about the project: here Dubai Electricity & Water Authority (DEWA) expects to award the tender for the development of a 200-MW concentrated solar power (CSP) project in Dubai during the first quarter of 2017, DEWA’s head said as cited by the Gulf News. The tender concerns the first phase of a 1-GW CSP project that is planned to be developed at the Mohammed bin Rashid Al Maktoum Solar Park by 2030. Earlier this month, DEWA unveiled that a consortium led by KPMG Lower Gulf Ltd has won the advisory service contract for the planned project. The phase I solar thermal power project is to be operational by April 2021. Ontario scraps 930 MW renewable energy tender planned earlier this year Source: Ontario.ca Date: 27 September 2016 Ontario will immediately suspend the second round of its Large Renewable Procurement (LRP II) process and the Energy-from-Waste Standard Offer Program, halting procurement of over 1,000 megawatts (MW) of solar, wind, hydroelectric, bioenergy and energy from waste projects. This decision is expected to save up to $3.8 billion in electricity system costs relative to Ontario’s 2013 Long-Term Energy Plan (LTEP) forecast. This would save the typical residential electricity consumer an average of approximately $2.45 per month on their electricity bill, relative to previous forecasts. No additional greenhouse gas emissions are being added to the electricity grid.

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Feed-in/premium tariffs China is looking to cut solar PV FIT Source: PV-magazine.com Date: 29 September 2016 A leaked document from China's National Development and Reform Commission (NDRC) suggests that the new FIT for ground mounted PV projects will drop sharply from the previous rates of RMB 0.80, 0.88 and 0.98 for the three different areas of the country to RMB 0.55, 0.65 and 0.75 respectively, which means a decrease of around 31.25%, 26.14% and 23.47%. For distributed PV projects, the uniform subsidy used in 2016, which stood at RMB 0.42 per kWh, will drop to RMB 0.20, 0.25, and 0.30 respectively for the three areas. Egypt announced second phase of the FIT programme with significantly lower tariff rates Source: Lexology.com Date: 12 September 2016 The Minister of Electricity and Renewable Energy (MOERE) has announced that, on 28 October 2016, a second phase (Phase Two) of the feed-in tariff (FIT) programme will commence. The programme was initially established in September 2014 (Phase One) and intended to attract direct foreign investment and financing for Egyptian photovoltaic (PV) and wind projects. However, the MOERE confirmed that only pre-qualified developers under Phase One are eligible to participate in Phase Two. New developers will only become eligible to participate in a Phase Two wind or PV programme if the 2GW capacity for the relevant programme has not been met by participating pre-qualified Phase One developers. To be eligible for Phase Two, proposed PV projects must comprise 70% foreign investment and 30% Egyptian, whilst wind projects must comprise 60% foreign investment and 40% Egyptian. Phase Two has seen a number of changes from Phase One including the permitting of offshore arbitration in an attempt to entice multinational lenders to return to the country after Phase One restricted developers to domestic arbitration, although reduced FIT rates may offset the impact of the increased flexibility in dispute resolution. The major difference between 1

st and 2

nd phase of the FIT programme are the levels of guaranteed prices

which were significantly decreased:

Provision Phase One Phase Two

Solar PV FIT levels: 500KW - 20MW

USD 13.6 cents/KWh USD 7.8 cents/KWh

Solar PV FIT levels: 20MW - 50MW

USD 14.34 cents/kWh USD 8.40 cents/kWh

Onshore wind FIT levels

USD 11.48 cents/kWh for between 2500 and 3000 operating hours and USD 9.57 cents/kWh between 3,100 and 4,000 operating hours for the first five years. A multitude of different specified tariffs thereafter

USD 4.00 cents/kWh for 5,000 hours or more at maximum capacity (for the duration of relevant PPA)

Payment exchange rate terms: PV

15% at EGP 7.15 and 85% pegged to the USD at the rate applicable on the due date

30% at EGP 8.88 and 70% pegged to the USD at the rate applicable on the due date

Payment exchange rate terms: wind

30% at EGP 7.15 and 70% pegged to the USD at the rate applicable on the due date

40% at EGP 8.88 and 60% pegged to the USD at the rate applicable on the due date

Financial Close

27th October 2016 The FIT rate was subject to reaching financial close by 27th October 2016 and 2GW capacity not being reached by financial close

Within six months from 28 October 2016 commitment letter from foreign lenders to be presented to FIT unit Financial close to be achieved within one year for PV projects and 1.5 years for wind projects, following 28 October 2016 We would assume that the FIT rate would still be subject to financial close occurring prior to the 2GW capacity being achieved

WindPowerMonthly reports that some renewable energy companies already decided to withdrawn from Egypt (Enel Green Power) while others still asses their situation.

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Egyptian authority recovers land from 5 companies that withdrawn to develop solar plants under FIT scheme Source: tradearabia.com Date: 9 November 2016 Egypt’s New and Renewable Energy Authority (NREA) has recovered the lands given to five companies for solar energy projects in Banban and Aswan as a part of the feed-in tariff scheme. Nine companies have withdrawn from the implementation of the feed-in-tariff projects, including Italian Enel Green, French Neon, Saudi Arabian Abdul Latif Jameel, Egyptian Cairo Solar, Spanish Dama, Canadian Solar, Innovation Unlimited Egypt, Emirati Adenium, and Egyptian Orascom Telecom.

Recent policy changes

OECD German renewables surcharge to rise by 8% in 2017 Source: PV-magazine.com Date: 11 October 2016 The country's transmission system operators are set to publish the newly calculated green power levy on Friday. The levy currently accounts for approximately 22% of a customer's total bill. For a three-person household with a consumption of 3,500 kilowatt hours a year, the tax will increase by 18 euros to 240 euros a year following the hike. Following the 8% increase, the surcharge will increase to 6.88 euro cents per kWh. Portugal mandated a retroactive refund of state grants for renewable plants that also benefited from FIT support Source: cms.law Date: 13 October 2016 Further reading:

Text of the Ordinance available here

Additional reading: Mondaq.com On 13th of October, Ordinance No. 268-B/2016, of the Secretary of State of Energy, was published in the Official Journal of Portugal. This ordinance is addressed to power plants included in the special regime which, in addition to feed-in-tariffs, have received public support funds for the promotion and development of renewable energy in the past. The promoters of these power plants are required to return to the National Electric System the "excessive" amounts received due to the accumulation of feed-in-tariffs and public support funds, in a global estimated amount of 140 million euros.

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France’s onshore support mechanism declared illegal by EC Source: Windpowermonthly.com Date: 5 October 2016 The European Commission (EC) has decided that a 2014 decree re-instating the guaranteed premium purchase price for onshore wind in France is illegal. The problem was caused by a reform of France's renewable and social surcharge on electricity bills (CSPE), which came into effect on 1 January 2016. As a result, the EC considers that France's support mechanism for onshore wind contravenes EU guidelines on state aid and must be replaced with a market mechanism. The industry knew this was going to happen, but had been reassured it would not be introduced until 1 January 2019, giving the sector time to prepare for the changeover. To resolve the situation, the French government is in the process of issuing a new decree to secure all contracts are signed in 2016. Producers will receive a "reference market price" based on the price earned on the wholesale market, plus a top-up payment, giving a total revenue roughly equal to the old tariff. Another decree will cover the situation from 1 January 2017. Smaller projects under six turbines will still be eligible for the top-up payment, while projects with more turbines will have to go through a tender process if they wish to receive the support. The industry expects the first tenders to be issued in 2018, but is waiting for details as to the timing and capacities. FEE is calling for a rolling programme of around 1.5-2GW a year to ensure France meets its targets. Given that both decrees must be issued by 31 December, the industry is working urgently to try to ensure acceptable terms. EC approves Greek support scheme for renewable electricity and cogeneration Source: Europa.eu Date: 16 November 2016 The European Commission has found the new Greek support scheme for renewable electricity and high efficiency cogeneration to be in line with EU state aid rules. The scheme includes state support either through a feed-in tariff or through a price premium in line with the EC’s Guidelines. Support with a feed-in tariff will be limited to small installations and installations on non-interconnected islands. Installations with a capacity above 500 kilowatt (KW) will, over a period of 20 to 25 years, receive a premium on top of the market price of electricity. Greece has demonstrated that the aid is limited in line with the Guidelines. This will minimise potential distortions of competition created by the public funding. EC's decision approves aid to larger installations (above 1 000 KW) for the year 2016. Under the Guidelines, as of 1 January 2017, aid to larger installations has to be granted through competitive tenders to ensure that energy is produced at minimal cost for taxpayers. Greece will organise a pilot tender for photovoltaic energy and has committed to use competitive bidding processes for all aid granted to large installations as of 2017. The Greek scheme will be financed through the renewables support levy currently in place in Greece. In order to avoid any discrimination against foreign renewable energy producers resulting from the financing mechanism, as of 2017 Greece will partially open up the renewables support scheme to foreign producers. Government of Alberta aims to become 50% PV powered Source: Photon.info Date: 10 October 2016 The Canadian province of Alberta announced its intent to power half of government operations with solar energy. The Canadian Solar Industries Association (CanSIA) states the Government of Alberta is leading by example as the first provincial or territorial government in Canada to explore the feasibility of meeting 50% of their annual electricity needs from solar energy. The process, if successful in identifying a supplier or suppliers that can construct and operate a solar farm that meet the province's economic criteria, could give rise to 100 MW of new installed generation capacity in the province.

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NYC targets 100 MWh energy storage by 2020; ramps up solar activity Source: PV-tech.org Date: 26 September 2016 New York City has set new targets for both energy storage and solar capacity in the city, of 100 MWh of energy storage by 2020 and 1 GW of solar capacity by 2030. New York City will issue permits for more than 3,000 solar panel installations this year, bringing the citywide total to over 8,000 in 2016, up from 1,819 installations at the end of the start of the de Blasio administration in late 2013. The city is on track to hit its 2025 target of 100 MW of solar power on public buildings and 250 MW on private buildings New York City has committed to an 80% reduction in its greenhouse gas emissions by 2050.

Non-OECD Kenya is debating replacing its feed-in tariff system with competitive auctions Source: Lexology Date: 7 November 2016 Recent reports (published by the Business Daily Africa, ESI Africa's Power Journal and Standard Media Kenya) show that Kenya’s Energy Regulatory Commission (ERC) is in the process of drafting new regulations, which are expected to be implemented by the end of Q1 2017. The new regulations are expected to introduce competitive auctions for awarding renewable energy projects in Kenya, shifting from the current feed-in tariff regime under the Feed-in Tariff Policy 2012 (revised in December 2012) which offers tariffs for small renewable projects up to 10MW and for large renewable projects above 10MW. Currently, the feed-in tariff system offers project developers and investors pre-determined rates for wind, geothermal, solar, biogas, hydro and biomass energy power projects without any requirement for tendering. As is typical in renewable energy programmes in other developing markets, the feed-in tariff system offers reliability, transparency and equality to developers. The main argument to move away from feed-in tariffs and adopt a competitive auction system is to introduce competition amongst project developers and investors in order to achieve lower pricing. The ERC believes that this new approach will encourage project developers and investors to reduce tariffs which ultimately benefit the end consumers. Brazil’s BNDES increases support for solar and terminates fossil fuel backing Source: Renewables.seenews.com Date: 4 October 2016 The Brazilian Development Bank, or BNDES, announced new rules and finance guidelines, with a focus on renewable energy projects. Solar energy is the power source that benefits the most as the bank is raising its level of participation when it comes to supporting such projects to 80% of the needed sum from 70% currently. At the same time, the bank is terminating support for coal and oil projects. Malaysia’s long-awaited B10 to be implemented by year’s end Source: Biofuelsdigest.com Date: 13 September 2016 In Malaysia, the delayed implementation of the B10 policy that was scheduled for June will now be ready before the end of the year. With an estimated additional demand of 750,000 metric tons above the current B7 policy, the additional use of palm oil is expected to pare down stocks and support prices.

RED, Renewable Policy Updated, Issue 11, 17 November 2016

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Philippines plan to limit renewable energy deployment in areas with a grid constraints Source: Thestandard.com.ph Date: 4 September 2016 The department will work closely with grid operator National Grid Corporation of the Philippines to make sure that there is an adequate yearly plan for transmission capacity. The plan will take into consideration daytime solar demand and the generation profile of the locations for wind power production. With these measures the government wants to avoid a situation where supply exceeds demand as is the case in Negros. The island currently has 490 MW of power generation capacity, but demand reaches just 309 MW, resulting in more than 180 MW of excess power that should be exported to Panay or Cebu, the report says. Malta’s revised version of NREAP pushes solar PV and heat pumps eliminating wind Source: maltatoday.com.mt Date: 3 November 2016 Malta’s NREAP II available here Malta is on target to meet its renewable energy target imposed by the European Union: by end 2014, a 3% target was met and surpassed and is now halfway to reach the 10% required by 2020. The Energy and Water Agency has launched the revised National Renewable Energy Action Plan for public consultation, confirming that Malta’s policy will depend strongly on the use of solar energy – accounting to over half of renewable energy dependency – and introducing biomass imports (0.2%) and heat pumps (1.6%). Compared to the original plan launched in 2012, the new strategy reduces the use of biofuels from 2.5% to 2.2% and increases the use of PV panels from 0.7% to 4.7%. Use of solar water heating increases from 0.5% to 0.9%.Waste-to-energy, originally planned to contribute 2.5% of total generation, has now been decreased to 0.5%, after earlier plans for a new incinerator were delayed. A wind farm at Sikka l-Bajda, which Malta had said would contribute to 4.0% of total renewable energy, was given the authorities’ thumbs down and found to be infeasible. The public consultation period ends on 1

st of December 2016.

Indian state Kerala to tap renewable energy to increase power production Source: Gulfnews.com Date: 11 October 2016 Annually spending a whopping Rs 60 billion (Dh 3.3 billion) to purchase power from outside, Kerala has decided to step up power generation through renewable energy sources like solar and windmill, a state minister has announced. The state aims to increase solar power capacity by 600 MW within next three years.

Climate change policy developments The Paris Agreement entered into force on 4 November 2016 Source: Unfccc.int Date: 5 October 2016 Paris Agreement - Status of Ratification tracker: here On 5 October 2016, the conditions for the entry into force of the Paris Agreement were met. The Agreement entered into force on 4 November 2016, in accordance with its article 21, paragraph 1, which reads as follows: “This Agreement shall enter into force on the thirtieth day after the date on which at least 55 Parties to the Convention accounting in total for at least an estimated 55 per cent of the total global greenhouse gas emissions have deposited their instruments of ratification, acceptance, approval or accession.”

RED, Renewable Policy Updated, Issue 11, 17 November 2016

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Germany adopted Climate Action Plan 2050 setting for the first time climate targets for sectors individually Source: bmub.bund.de Date: 14 November 2016 Summary of the Climate Action Plan 2050 available here; After long negotiations, Germany’s government agreed on a basic framework for decarbonising its economy to reach 2050 climate goals. The Climate Action Plan 2050 includes target corridors for reducing greenhouse gas emissions in individual economic sectors and emphasises the need to ensure economic competitiveness throughout the transition. The Plan is Germany’s guideline to the fulfilment of its Paris Agreement commitments.

Aviation climate agreement reached at ICAO on global carbon offsetting scheme Source: renewableenergyworld.com Date: 10 October 2016 Following six years of negotiations, governments meeting at the International Civil Aviation Organization (ICAO) have reached agreement on the design elements of a global market-based measure for international aviation. It is part of a series of actions the aviation industry is taking to reduce its carbon emissions which includes investing in new technology, scaling up the use of sustainable alternative fuels, improving operational performance of aircraft in the fleet already and using more efficient infrastructure. 65 countries, including the United States and China, have reached an agreement to cap greenhouse gas (GHG) emissions from international aviation at 2020 levels, by implementing a voluntary market mechanism that would later become mandatory. The International Civil Aviation Organization (ICAO) aims to achieve carbon neutral growth from 2020 and participating aviation operators will have to offset any additional emissions above a 2020 baseline. The system will take effect in 2025 and will be voluntary for the first six years, before becoming mandatory. The agreement is expected to cost airlines around US 5.3 bn/year in the first years and up to US 24 bn/year by 2035.

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