Portugal’s 670 MW Solar Auction Sets a New Record with Lowest Bid of $0.013_KWh

The government of Portugal has concluded the solar auction held for 670 MW capacity. The second solar auction by the country set a new record with the lowest bid of €11.14 (~$13.16 / ₹971.3)/MWh or €0.01114 (~$0.01316 / ₹0.97)/kWh.

In the auction which took place on August 24 and August 25, Hanwha Q CELLS turned out to be the biggest winner with the allocated capacity of 315 MW. Of the 12 lots awarded in the auction, the South Korean solar manufacturer managed to bag six.

According to the government statement, the awarded capacity of 670 MW was distributed between six entities, with half of them being international players.

In the auction, 75% of the 670 MW, which is 483 MW was for solar with storage capacity, and the remaining capacity of 177 MW was under “system compensation” and 10 MW under “contract for differences.

Last year’s solar auction in Portugal had also seen a record-low bid of €14.76 (~$17.4)/MWh or €0.01476 (~$0.0174)/kWh, which has now been breached. Held in July 2019, the auction awarded 1,150 MW, and 13 bidders had won projects.  Based on the locations where these projects were to be installed, the winners were those offering the highest discounts to the bidding tariff of €45 (~$53)/MWh. This was the largest solar auction in Portugal, and the capacity was equivalent to more than twice the installed solar capacity in the country.

The lowest bid of €14.76 (~$17.4)/MWh was quoted by Akuo Renovaveis Portugal. And now, Akuo’s 180 MW project is set to be executed. According to the environmental licensing process, which has just started, the Santas power project will have a total of 444,000 solar panels with bifacial technology.

The company had quoted a price significantly lower than the base price of the bid at €45 (~$53)/MWh, to secure the right to develop the project. The tariff discovered in the auction was €14.76 (~$17.4)/MWh for 15 years. In the auction, Akuo had also secured the rights for two other projects of 120 MW and 100 MW, but with a higher price of €20.7 (~$24.5)/MWh and €19.8 (~$23.4)/MWh, respectively.

Joao Glamba, the secretary of state for energy, had commented at the time, “This first auction in Portugal was a success. In addition to getting the lowest prices in Europe, we hit new world lows. This auction shows that the energy transition, to which the government is committed, not only can strongly accelerate investment and the penetration of renewables in Portugal, but it can be done at low prices.”

Recently, the European Union announced that the imposition of countervailing duty on solar glass imports from China would continue. The individual countervailing duty on solar glass in the EU currently in force ranges from 3.2% to 17.1%. The new measures came in effect on July 23, 2020. The Commission had initiated a review of the duties applicable to the import of solar glass.