German Greens call for larger PV auctions as tariffs drop below 5-cent-per-kWh mark

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on reddit
Reddit
Share on email
Email
The latest PV-only tender brought a victory to Bavarian solar players, who scooped up 130MW of the 153MW contracted Germany-wide. Image credit: Philipp Bachhuber / Unsplash

Germany is crippling solar’s ability to produce large volumes of ever-cheaper electricity even as it retains too-large tenders for wind that end in undersubscription, the country’s Greens have said.

Last Friday, the party urged the federal government led by chancellor Angela Merkel to stop restricting solar tender sizes after the latest exercise only awarded 153MW – in line with its initial target of 150MW – of all 648MW in bids put forward by PV players.

The 27 project winners of the oversubscribed PV-only auction of 1 October were contracted at average tariffs of €0.049/kWh (US$0.054/kWh), a drop on the prices reached at prior solar tenders in March (€0.0659/kWh or US$0.073/kWh) and June (€0.0547/kWh or US$0.061/kWh) this year.

Speaking after the results were unveiled by Germany’s Federal Network Agency (FNA), Julia Verlinden of the German Greens criticised the government for “preventing investments” in solar despite the fact that the electricity source is running “reasonably well.”

“Instead of finally increasing tendering volumes and producing more solar power for less than 5 cents per kilowatt-hour, the government is putting a lid on it,” said the spokeswoman. “The result: Three-quarters of all bidders for solar projects were left empty-handed this round.”

Velinden contrasted the solar auction’s oversubscription and price drops with the lack of appetite for an onshore wind tender also held on 1 October, which triggered 204MW in bids – all of which were rewarded with contracts – for a total target size of 675MW.

The Greens’ spokeswoman rued Germany’s decision to keep wind tenders large even as it fails to act against bureaucracy and land scarcity for these projects. The latest PV and wind results, Verlinden said, show the federal government is “doing everything wrong” with renewable policy.

Tender-buoyant PV eyes 98GW-by-2030 goal

The 1 October PV tender at the centre of the political row marked a victory for Bavarian solar players. According to the FNA, the state’s decision to expand its quota of project-suitable arable land helped the territory’s PV schemes secure 130MW of the 153MW contracted nationwide.

In Germany, the autumn solar auction is the latest of a series to end in major oversubscription. The aforementioned March tender triggered 869MW in bids for the 500MW that was on offer, while the June edition recorded 556MW of requests for a 150MW pot of contracts.

The industry has also steamrolled at Germany’s latest technology-neutral auctions. At tenders last November and in April, PV players snapped up all contracts where wind secured none, scoring respective average prices of €0.0527/kWh (US$0.058/kWh) and €0.0566/kWh (US$0.063/kWh).

Solar’s continued buoyant performance has emerged as the Merkel-led coalition government acts to make the technology a key engine of the renewable transition. Under newly-adopted plans, installed PV capacity should more than double between 2019 (48GW) and 2030 (98GW).

In parallel, the coalition between Merkel’s conservatives and the social democrats has agreed to axe a PV subsidy cap that would have otherwise applied once the market reached 52GW. While relieved at the move, PV association BSW has recently called for its urgent implementation.

Some PV operators are however opting to sidestep subsidies altogether, joining the subsidy-free shift underway in Spain, Italy, the UK and others. This past year alone, zero-subsidy projects have been announced by EnBW (180MW), THEE’s and CEE (500MW), BayWa r.e. (8.8MW) and others.

As lawyers told this publication for a recent PV Tech Power feature, German operators are slowly warming up to the power purchase agreement approach. Researchers believe the country could unlock a €2 billion (US$2.25 billion) market if it acted to de-risk these deals.

The prospects and challenges of solar's new era in Europe and beyond will take centre stage at Solar Media's Solar Finance & Investment Europe (London, 5-6 February) and Large Scale Solar Europe 2020 (Lisbon, on 31 March-1 April 2020).

Read Next

September 14, 2021
Renewables developer BayWa r.e. and the Fraunhofer Institute for Solar Energy Systems ISE have built a new research project to explore how solar systems can protect plants and fruit from extreme weather.
September 14, 2021
Polish renewables developer PAD-RES is to be acquired by a joint venture established by real estate investor Kajima and private equity firm Griffin Real Estate.
September 7, 2021
Supply disruptions in the coal and gas sectors have contributed to record electricity costs across Europe, leading to calls for more support for renewables generation to mitigate future price rises.
September 1, 2021
French utility giant Engie has signed a 24/7 power supply agreement with Google for 140MW of carbon-free energy to its operations in Germany in an arrangement the companies have called a “first-of-its-kind”
August 20, 2021
Solar PV plants generated 10% of the EU-27’s electricity demand during June and July this year, new analysis by energy thinktank Ember has found.
August 17, 2021
PV Tech speaks to JA Solar’s Henning Schulze about the module manufacturer’s European strategy, how vertical integration is helping it mitigate supply chain volatility and why lessons from the stock market can help guide solar module purchasing.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
October 6, 2021
Solar Media Events
October 19, 2021
BRISTOL, UK
Solar Media Events
December 1, 2021