<article><p class="lead">German market regulator Bnetza has awarded 4.79GW of coal-fired capacity closures in a first tender, which was significantly oversubscribed.</p><p>Bnetza received 11 bids covering a combined capacity of 4.79GW. This compares with the 4GW that the regulator offered in the tender, the deadline for which was 1 September. All bids were successful.</p><p>The average price in the tender was €66,259/MW — the lowest bid value was €6,047/MW, while the highest went through at €150,000/MW. The maximum price for the tender had been set at €165,000/MW. The successful bids will result in closure payments totalling €317mn.</p><p>The largest successful bid has a capacity of 800MW and the smallest 3.6MW.</p><p>Bnetza awarded capacity taking into account the bid value as well as the ratio of the required payment to the CO2 reduction that is likely to be achieved by closing the unit.</p><p>Under this method, hard coal-fired plants with a high level of CO2 emissions are given priority for contract awards when bidding the same amount as a plant with lower emissions. This also means that some bidders may be unsuccessful even if they submit a lower bid per MW of capacity than the highest bid value that is awarded.</p><p>Coal-fired plants that have been awarded a closure contract will stop selling their power in the German wholesale power market from 1 January.</p><p>Transmission system operators (TSOs) are now checking the system relevance of the successful plants. If the regulator approves the system relevance designation of a plant at the request of a TSO, the plant will be made available to the network reserve. It will no longer be able to sell electricity on the market, but is still available to ensure the security of the electricity grid in critical situations, Bnetza added.</p><p>The next tender, in which Bnetza will seek to allocate 1.5GW, is scheduled to open on 7 December, with bids to be submitted by 4 January.</p><p class="bylines">By Jacqueline Echevarria</p></article>
