German Renewable Energy Auction Awards 201 Megawatts To Solar
For the second time this year, Germany has awarded all available capacity from its latest mixed wind and solar renewable energy auction to large-scale solar projects, awarding a total combined capacity of 201 megawatts (MW).
So far in 2018 Germany has held several types of renewable energy capacity tenders — for onshore wind, offshore wind, solar tenders, and mixed-wind and solar. Germany’s Federal Network Agency, the Bundesnetzagentur, announced the winners for the year’s second mixed tender, and again all capacity awarded went to solar. However, this time, according to agency president Jochen Homann, “There was only one bid for wind turbines on land, which was above the surcharge limit.”
In April, the Bundesnetzagentur awarded a total combined capacity of 210 MW to 32 solar projects with an average final price of €0.0467 ($0.0577) per kWh (slightly above the €0.0433 per kWh awarded to the solar-only auction in February).
Fast forward to November, and the Bundesnetzagentur announced on Monday that it had awarded a total combined capacity of 201 MW to 36 projects at an average cost of €0.0572 ($0.065) per kWh — well above the February and April prices. Further, the November bids ranged from €0.0465/kWh to €0.0579/kWh — even starting above the average price awarded earlier this year.
The Bundesnetzagentur revealed that a total of 307 MW worth of bids were tendered in the 200 MW auction, and only two bids out of a total of 50 were excluded due to formal reasons.
This is also the second time that a mixed-solar and wind tender included Germany’s procedures for the “so-called distribution network expansion areas.” Specifically, according to the Bundesnetzagentur, “Bids in areas where there are already many renewable energy facilities have been subject to a bid premium, thus reducing their chances of winning. This is to take into account an increased distribution network demand in these areas.” However, as in the year’s first mixed tender, the agency said that this “special arrangement had no impact on the successful projects.”
“We are seeing what we expected, solar is now the cheapest form of electricity production in many parts of the world and the results in Germany are underlining this,” said James Watson, Chief Executive of SolarPower Europe. “This trend is one that is likely to continue as solar prices continue to fall and we can expect further technology neutral auctions to be won by solar. This is doubly so following the fall of the trade tariffs and as such solar is the most competitive form of energy for much of Europe.”
“Organising joint auctions is not the best way to organise the energy transition,” added Andrew Canning, Press and Communication Manager for WindEurope. “Having separate auctions allows countries to plan more precisely according to their needs. And for the supply chain to make long-term investments. Renewable technologies should be complementing each other not competing.
“It is very challenging to design an auction where technologies compete on a genuinely level playing field. And it’s not desirable. Wind and PV make different contributions to the energy system, produce at different times. They are complementary. So ‘tech specific’ auctions are the way to go.”
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