Thứ Hai, 1 tháng 7, 2019

Brazil A-4 auction signs 211 MW of solar for record-low price of $0.0175 kWh

Cracking the two-cent-mark as a global standard for PV appears within sight as projects in the U.S. and Brazil have been signed below that threshold. Just two years ago the industry celebrated sub-three-cent bids in the MENA region. Prices have come down so quickly, however, the new records are another third cheaper.

Brazil’s most recent A-4 renewables auction saw 211 MW of PV capacity signed at $0.0175/kWh – a new world record.

Brazil’s Agencia Nacional de Energía Eléctrica (Aneel) announced results featuring a remarkable price for solar. The tender contracted 401.6 MW of renewable energy generation capacity, with solar taking a lion’s share of 211 MW, according to Aneel.

The 211 MW amounted to five projects with a 30 MW generation capacity each plus a 61 MW facility. The smaller projects prompted one bid of BRL64.99/MWh ($16.88/MWh) and the average price fell to BRL67.48/MWh ($17.52/MWh) breaking the magic two-cents per kilowatt-hour sound barrier.

Last week, a 200 MW solar project in Los Angeles undercut the two-cent benchmark when it was contracted for $0.01997/kWh – the U.S.’ lowest bid for a solar project. That bettered a two-month U.S. record after Idaho Power announced it had signed a 20-year power purchase agreement with Jackpot Holdings for $0.02175/kWh in March. The previous lowest prices for U.S. solar PPAs were held by the $0.02375/kWh secured by 8minutenergy in Nevada and the $0.0249/kWh bid for a project in Arizona, as well as a project in Austin which was said to come in below $0.025/kWh – the details of that contract were never made publicly available.

Auction assistance

The replacement of feed-in tariff incentive programs with competitive reverse auction tenders around the world have dramatically reduced the price of solar power. French multinational Engie’s bid to make history in 2017, with a Saudi tender bid of $0.0178/kWh, was undone by the kingdom’s Renewable Energy Project Development Office, which instead opted for a significantly more expensive price of SAR0.08872/kWh ($0.0236/kWh) tendered by local player ACWA.

When the first projects passed the $0.03/kWh benchmark in the Middle East and North Africa region in 2017, the industry watched in awe. Just two years later, the solar world is watching prices fall below the $0.02/kWh mark.

The projects in Brazil – and the U.S. – will not start generating power before 2023.

When companies lodge tender bids for projects years down the line they attempt to anticipate price developments. The new batch of record low solar projects indicates system costs could come down even faster than the usually expected digression rate.

Recent analysis from Taiwanese market research company Energytrend has predicted module prices, especially in the high power segment, have been coming down in China with the rest of the world set to experience a knock-on effect this week.


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