Vattenfall has won a tender to build two offshore wind farms with a record-breaking bid of EUR 60 ($67.33) per MWh – 20% lower than the previous record set by Dong Energy in July. The low bid is supported by the location of the wind farms, which are in close proximity to the shore in the Danish North Sea, leading to lower costs for foundations and transportation. This tender may not be the final word, however. Vattenfall still needs final approval from the Danish government, which is considering an end to support for near-shore wind farms.
If approval is forthcoming, Vattenfall will initiate final preparations for the wind farms, including procurement, services, optimisation and final design, with the aim to start construction in 2019 and to begin producing power in 2020. The projects are expected to have a total capacity of 350 MW and will provide sustainable energy for 375,000 households once complete.
German power companies have begun separating conventional plants from their green-energy initiatives in reaction to the government’s shift toward wind and solar generation. The policy has hurt profitability at traditional utilities and driven down wholesale energy prices. EON, for example, spun off and bundled its renewable, energy network, and customer solutions business, from the rest of the company in January this year.
Meanwhile, a group of 44 countries in Europe committed to participate in a global carbon market for airlines starting in 2021. The European Union, its 28 member states, and 16 other nations adopted a political declaration on emissions ahead of a United Nations’ aviation body meeting next month. The International Civil Aviation Organization plans to agree on how airlines are charged for carbon emissions after 2020. According to the European Union, direct emissions from aviation account for roughly 3% of the bloc’s total greenhouse gases, with a large majority arising from international flights.
The US recorded a 43% surge in solar installations in the second quarter. This was due to a wave of utility-scale projects taking advantage of an extension to the federal Investment Tax Credit. The ITC was scheduled to expire in December last year, but was unexpectedly extended by Congress at the end of 2015 for another five years. Developers added 2,051 MW in the quarter, up from 1,436 MW a year earlier, according to the US Solar Energy Industries Association. With an additional 7.8 GW under construction, more solar capacity is on pace to be connected in the second half of this year than has ever come online in a single year, the Washington-based industry group said in a report.
Finally, in emerging markets, Argentina received huge interest in its renewable energy auction held on 5 September – over six times the capacity it could accept. In response, the nation’s energy and mines minister, Juan Jose Aranguren, told reporters the interest “exceeded our expectations” and described it as a good sign for the country’s ambitious clean energy plans. The government invited bids for 1,000 MW of renewable power, but it received offers for 6,366 MW. Winning bids are scheduled to be announced in October, and Aranguren expects “to sign the contracts as soon as possible”. The nation currently gets about 2% of its power from renewables but targets 20% by 2025.
This article is an extract from the BNEF Week in Review published the 13th of September