Re-stream part 1 (“Overview of NER300 Call for Proposals – Timing; process; roles and responsibilities; technical and financial requirements” and “Selection process – eligibility; due diligence; ranking; geographical balancing”) here and part 2 (“Requirements for disbursement – legally binding instrument; knowledge sharing; monitoring, reporting and verification”) here.
…for entry into operation of projects
The EC is giving itself until the second half of 2012 to sign NER300 grant agreements (“Award Decisions”). This is a good deal later than the date of 31 December 2011 that had been foreseen in February. The deadline for projects to become operational will be increased correspondingly such that they must enter into operation within 4 years of the award decision.
…for submission of proposal to the Member State
The Call requires proposals to be submitted to the Member State within three months of the launch, meaning by 9 February 2011. The Commission clarified that Member States in fact have complete discretion to allow project sponsors to submit later or to revise submitted proposals providing they keep to the deadline of 9 May 2011 for forwarding the proposals to the EIB.
…to submitted proposals once they have been sent to the EIB
The EIB will allow changes to the data contained in proposals that establish its CPUP. This will occur if the EIB rejects the reason given by the project sponsor for one or more of the quantities that it used to determine CPUP. In that case, the EIB will substitute the rogue values with values that it deems reasonable and rank the proposal on that basis.
… by a Member State as the list of recommended projects is being drawn up
Once the due diligence assessment is complete, the EIB will reconfirm with the Member States the value and structure of the total public funding contribution of those projects that have made it onto the list of recommended projects (§103). The point was raised in the meeting that the Member States would have no option other than to confirm the commitment already given. Altering it would affect CPUP, either requiring the list of recommended projects to be recompiled (and potentially also the make-up of the Group that the project belongs to) or introducing the possibility of gaming by giving Member States the chance to bid low initial levels of state support in order to win the competition. The State Aid assessment (§83) would need to be redone if State Aid to a project is increased.
The EC expresses the desire to avoid subsidy competition between Member States in Recital 6, so NER300.com expects the further guidance it has promised on §103 to limit their room for manoeuvre.
A RES Group of 34 projects and a CCS Group of 8 projects
Surprisingly the Call does not explain how to create a RES Group of 34 projects (which corresponds to the total number of sub-categories across all RES categories) and a CCS Group of 8 projects if not all (sub-)categories are filled with a project that has passed the due diligence assessment and, where applicable, the competitiveness check. Article 8(2) second last sub-paragraph of the Decision specifically highlighted this as a problem area that the Call should address.
The EC instead provided answers in the meeting. A category with empty sub-categories will add a proposal to the RES/CCS Group from a sub-category for which an additional qualifying proposal is available. Two situations therefore exist that give rise to the possibility to fund multiple proposals in the same technology area in the 1st Call: the one outlined above, where there are insufficient or weak proposals in a particular (sub-)category but enough money is in the NER300 pot to fund more than one project in a sub-category populated with sufficient qualifying proposals, and the case described in §64 of the Call where the size of the NER300 pot exceeds the sum demanded by all the proposals in the CCS and RES Groups.
The second call, intended to correct technical and geographic balance, might not even have CPUP as a selection criterion, said the EC.
NER300.com’s article on reference plants has been updated to reflect the information given in the meeting.
Further information and analysis is available to NER300.com clients.
EUAs are EU emissions allowances, electronic certificates entitling the bearer to emit one tonne of CO2. CCS projects are exempt from the obligation to surrender allowances for the tonnes of CO2 that they capture and store safely. Relevant costs, under the rules of NER300, are net of this ‘avoided cost’.
To complete its application, each CCS project will be required to give the ‘best estimate’ of its ‘operating benefit’ for the 10 years from which it starts operation, which implies that it will also need to provide its best estimate of the price of carbon going out well into the next decade.
DG CLIMA, the part of the European Commission responsible for NER300, held an web-streamed ‘Info Day’ in Brussels on Friday 19 November from 13:30 to 17:00. The agenda that the event followed is available here. The language of the event was English (no interpretation).
Registration was required both to attend in person and, in seems, to view the web-streaming.
Scott Brockett from DG CLIMA took almost all the questions. He was flanked by representatives from the EIB and familiar faces from DG RTD. Sitting immediately next to him and apparently taking notes, was a man from the consultancy that DG CLIMA has hired to assist it with the preparation of the Call. The renewables interest in DG ENER was, it seemed to your correspondent, entirely absent.
One of the questions demanded general audience participation. The questioner wanted to know who in the room had an interest in NER300 from a renewable energy perspective and who from a CCS perspective. The room was divided 50/50. The last time the Commission held an NER300 Info Day, in June 2009, the room was overwhelmingly filled with CCS supporters.
In the EC’s midday briefing to journalists, a spokesman confirmed that Connie Hedegaard, the Commissioner for Climate Action, would give a press conference tomorrow where she would launch the first NER300 call for proposals (2 minute video clip). The launch follows the publication today of the NER300 Commission Decision in the Official Journal of the European Union (see links in right-hand margin).
Some interesting insight into the state of preparation of the first NER300 call for proposals (launch date reported by Reuters for the call: 8 November) is given in this recent Commission presentation.
Support to bidders
The most interesting news concern the Commission’s policy on providing support to potential bidders. Page 5 top slide says that a web-streamed "Info Day" will be held for project developers. The expectation is that DG CLIMA will organise it and that it will be held in Brussels soon after the launch of the call [UPDATE: date fixed for 19 November. See post]. An additional Info Day will be held for Member State officials.
The EC will retain the services of the consultants it used to write the NER300 call to answer questions submitted to a "helpdesk" e-mail address. The questions and answers will be published on DG CLIMA’s NER300 website.
Page 12 top slide gives new timings for the first NER300 call. Little now stands in the way of the call’s publication. Since the presentation was made, the interservice consultation on the EIB co-operation agreement has been completed and the "written procedure" referred to on page 3 bottom slide has begun.
The presentation corroborates an EC memo on the NER300 state-of-play made to the Council of Ministers on 8 October. The memo confirms that Member States will have six months from the publication of the call to submit the projects they wish to support to the EIB, and that the EC’s best guess of the amount of money that will be raised from the monetisation of all 300 M emissions allowances is 4.5 bn EUR.