Prices drop at last 600 MW solar and wind auction in France

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France selected nearly 100 solar and wind projects with a cumulative capacity of 600 MW during its last auction.According to the French Ministry for Ecological Transition, these projects will benefit from public support in the form of a guaranteed purchase price for the electricity produced.

The ministry statement noted that despite COVID-19, tenders received an enthusiastic response and received more requests than the volumes offered. The statement added that prices have also fallen sharply compared to previous tenders, confirming the decline in costs and competitiveness of the sector.

The government has selected 45 ground-based solar projects with a cumulative installed capacity of 332 MW. The average price of the projects selected is € 57.4 (~ $ 68.10) / MWh, a decrease of 7.4% compared to the previous session. It also selected 31 self-consumption solar projects with a total capacity of 9 MW. The average price for these projects was € 13.8 (~ $ 16.36) / MWh, a decrease of 14% compared to the previous auction.

The ministry also selected 23 wind power projects with a total installed capacity of 258 MW at an average rate of € 59.7 (~ $ 70.83) / MWh. The average price of the selected wind projects decreased by 4% compared to the previous auction.

When completed, these projects are expected to generate around 1 TWh of carbon-free energy per year to meet the electricity needs of around 190,000 households.

France has implemented support tariffs for renewable energies. Under this mechanism, France pays renewable producers for 15 to 20 years.

Two purchasing mechanisms in France:

  • The government directly purchases the energy produced at a fixed price
  • The producer sells the energy on the market and the government compensates the difference between the market price and the guaranteed price

The ministry said renewable energy projects for the first half of 2020 have been split into two periods. To complete the current session, a new call for tenders will be launched for solar and wind projects in November 2020, he added.

Last month, France announced plans to invest 100 billion euros (~ $ 118.4 billion) to recover the economy from the damage caused by the COVID-19 pandemic. As part of its “France Relance” plan, the government has allocated 30 billion euros (~ $ 35.51 billion) to the green energy sector.

Previously, French data and statistical studies indicated that the country had added 379 MW of new solar capacity during the first half of 2020. These new installations were mainly concentrated in the southern part of the country. The total cumulative installations in France reached 10.3 GW at the end of June 2020.

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