CRE reviews support mechanisms for solar projects

The Energy Regulation Commission (CRE) is proposing changes to how it supports solar energy projects in response to intense competition seen in recent bidding processes. It suggests expanding the "Small PV" tender to include projects up to 1 MWc and adjusting the thresholds for other tenders accordingly.

High competition in recent tenders

The CRE has analyzed the results of recent solar tenders, which saw record levels of participation. The latest "PV Ground" and "AOS Small PV" tenders were heavily oversubscribed, with more applications than ever before.

Selected projects and price drop

For the 9th period of the "PPE2 PV Ground" tender, the CRE selected 125 applications totaling 931.4 MWc. The average price dropped significantly to 61.33 €/MWh, a 23% decrease compared to the previous period, attributed mainly to increased competition.

High number of small projects

The number of applicants was particularly high, with 5,358.7 MWc of total power requested. A large portion of these were small projects, with 61% of applications for projects under 5 MWc. Many of these were under 1 MWc, which were intended for a specific small-project gateway that was never finalized.

Lower connection costs benefit small projects

Projects under 1 MWc may have a competitive edge due to potentially lower connection costs. These savings come from specific calculation methods for the S3REnR share, a component of the cost structure for connecting to the grid.

Focus on degraded and agrivoltaic land

Among the selected projects, a significant number were on degraded land or involved agrivoltaics, which combine solar panels with agricultural use. These accounted for a large share of the total power, though their success rates varied compared to projects in natural areas.

Support mechanisms influence prices

The average price of projects on degraded land, which receive a financial bonus, was higher than the overall average. In contrast, projects involving "case 2 bis" land had a lower average price, showing the impact of different support policies on project costs.

Trend continues in small PV tender

The "PPE2 Small PV" tender, for projects between 100 and 500 kWc, also saw a price decrease of 15% compared to the previous period. The CRE selected 871 applications totaling 288.3 MWc, with a weighted average price of 75.48 €/MWh.

Strong competition and European content

Competition was fierce in this tender, with 2,952 applications for a requested volume of 288.3 MWc. The declared European content for inverters, a key component of solar systems, increased dramatically from 11% to 83%, indicating the influence of tender criteria on suppliers' choices.

Self-consumption still limited

Self-consumption, where users generate their own electricity, remains a small part of the applications. Only 13% of projects declared participation in self-consumption, and the average price for these was slightly lower than the overall average.

CRE recommends stronger competition and clearer rules

The CRE believes that stronger competition leads to lower costs for public finances and recommends increasing the visibility of the sector in future tenders. It also proposes adjusting the thresholds for different tenders to better reflect the current landscape of solar projects.