Subsidies plummeted in the first of six tender rounds for
large-scale ground-based solar power in France, results published by the energy
ministry on Thursday showed.
This is likely to squeeze profits for other sources of
electricity as the cost of generation from ground-based solar comes close to
parity with combined-cycle gas turbines (CCGTs).
There were 79 winners of a combined 500MW of capacity in the
first solar PV tender, which ran from 9 January–3 February, the ministry said.
The tender was the first to be held under the country’s multi-annual energy
plan, adopted in 2016, to drive investment in solar power over the next three
years.
Most of the installations will be built in the south of
France, the list of winning developers showed.
The government has set a target to have between 18.2GW and
20.2GW of solar PV capacity installed by 2023.
The average volume-weighted award for the projects was
€62.50/MWh, which is likely the lowest bid for ground-based large-scale solar
PV installations in Europe. The award is a feed-in premium which will be paid
on top of the wholesale power price.
Germany’s previous solar power tender in February 2017
yielded an average feed-in premium bid of €65.80/MWh
“The issue at stake for the market now relates to renewables
because the production is no longer marginal,“ Nicolas Couderc, director at EDF
Energies Nouvelles, told the audience at an industry event in Lyon in France on
Thursday.
Costs
In France, estimated production costs for ground-based solar
PV plants range between €64.00-178.00/MWh, according to a report published by
ADEME, the French environment and energy management agency, in January.
But costs have been falling fast. Average winning bids in
solar tenders in France have falling sharply in recent years, from €162.20/MWh
in March 2013 to €135.60/MWh in March 2015, although this was a total feed-in
tariff, so a total income figure.
And more recently costs have fallen quicker still. Assuming
a power price in the region of €35.00/MWh, the feed-in premium would give total
income of €92.50/MWh.
In comparison, the lowest possible production costs for a
CCGT, taking into account a carbon price of €7.00/MWh, was €47.00/MWh, but the
average for such plants was between €80.00-90.00/MWh, according to the ADEME
report.
Bonus
The solar developers will receive a top-up premium whenever
the wholesale electricity price is below the guaranteed award. In addition to
the premium, they will receive an annual bonus in order to assure that revenues
covers the investment. More than 60% of them will receive investment support of
€3.00/MWh, the ministry said.
Installed French solar PV capacity was at 6.8GW by the end
of last year, according to transmission system operator RTE. This means that
something between 11.4GW and 13.4GW of solar power could be installed in France
over the next six years – a very large amount with the potential to drastically
alter the structure of the French power market.
A spokesman from the French energy ministry said that it was the government’s ambition to install 2GW of solar power each year.
French energy minister Segolene Royal announced in August
2016 a three-year tender period to install a total of 3GW of solar PV between
2017 and 2020. The capacity will be divided into six tranches of 500MW every
half year.
The second 500MW tender for solar PV opens on 9 May and
closes on 1 June, according to the French energy regulator CRE.
No comments:
Post a Comment