Spain Continues Solar Resurgence With 2 GW Allocations At Auctions

Spain Continues Solar Resurgence With 2 GW Allocations At Auctions

At an average price of Rs 2.16/KwH and a lowest of Rs 1.31/KwH, solar prices continue to drive out wind energy from renewable auctions.

Spain, which has had a solar boom of sorts ever since its first large 3 GW auction in 2017, has delivered yet another boost to solar capacity growth in the second such auction that was  closed on January 26. The auction had reserved 1 GW for solar, and 1 GW for wind energy. Both the targets were comfortably met, with total over subscriptions at 3 times. Solar came out the clear winner, with over 2 GW of the winning bids.

With a 10 GW target for fresh Solar PV by 2025, this auction points to a comfortable exceeding of that target, if solar continues to exceed wind as comfortably as it has here.

Spain’s Ministry for Ecological Transition announced the names of 32 winning bidders who have secured a total of 3,034MW of capacity, of which 2,036MW is solar PV and 998MW wind. These projects will get a 12-year power purchase agreement from the government, with an option to move to merchant power at the end of the period. Somewhat surprisingly, energy storage was not part of any of the bids, pointing to the challenges energy developers still see with pricing the same with solar. Projects are due to be commissioned by March 2023. Almost all the winning bidders seem to be Spanish/European firms as of now.

The average winning bid for solar PV was at €0.0244/kWh (Rs 2.16) with the lowest bid coming in from Ignis at  €0.0148/kWh (Rs 1.31).

The 3 times oversubscription was driven by 84 firms that participated.

The spanish government estimates that the winning bids will draw an investment of €2.1 billion, while employing 27,000 people.

Leading Winners

Company PV capacity awarded (MW)
X-Elio Energy 315
Iberenova 243
Naturgy 196
Solaria 180
Elawan Energy 175
Garnacha Solar 150
Ignis 125
EDP Renováveis 98
Hanwha Energy 86
Engie 85

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