by Josefin Berg, senior analyst, IHS Markit
Los Angeles CA (SPX) Sep 05, 2016
The demand for ground-mount photovoltaic (PV) capacity in Europe will decline by 40 percent in 2016 over the previous year, but recovery is expected after 2018. Part of this recovery will take place through future demand in currently non-existing markets.
IHS Markit has observed an evolution of ground-mount PV pipelines in European markets without explicit support for such projects, including Ireland, Spain and Portugal. As we have seen in other countries in the past, these planned projects could be installed very quickly, as soon as a regulatory framework can ensure sufficient revenues for investors.
In Spain, recently announced initial plans for a renewable power tender that could include 2 gigawatts (GW) of solar power is reviving the hope to deploy PV plants among developers with planned projects in this currently dormant market. More than 8 GW of PV projects under development have secured grid-connection permits over the past four years, but the majority has not advanced further.
Of these projects, IHS Markit is tracking close to 2 GW that have advanced over the past year toward receiving final construction approval. The developers of these projects claim that the revenue from these projects would come from selling power on the wholesale power market, an approach that IHS Markit deems highly risky, with low chances for most projects to secure the necessary financing. However, a potential PV tender increases the likelihood that some of the pipeline projects could be built over the next five years.
PV developers in Portugal also claim to target the wholesale power market, but with smaller scale than in Spain. In fact, grid-connection applications for 2.3 GW of projects have already been filed, but until Portugal announces a solid support scheme for large-scale PV plants, the majority of planned projects are unrealistic.
It will be very difficult to finance projects without fixed-rate power purchase agreements. Iberian power prices do not justify such an investment, and PV projects need guaranteed long-term revenues to be viable.
In Ireland, policy makers are preparing an incentive scheme to come into place in 2017. This is also the European market where the PV pipeline has grown most rapidly over the past year. IHS Markit currently tracks 3 GW of PV projects in Ireland at various stages of permitting.
All of these projects are betting on future incentives for ground-mount PV projects. Few details have been released regarding the tariffs or conditions in a future support scheme. If an attractive scheme comes into place, a wave of construction activity can be expected.
These are three markets, where developers have eagerly built up PV pipelines in anticipation of improved local conditions, and further decline in PV system prices. The exact contribution that these countries will provide to the overall ground-mount PV market in Europe still hinges on regulatory provisions that have yet to be rolled out.
All About Solar Energy at SolarDaily.com
|The content herein, unless otherwise known to be public domain, are Copyright 1995-2017 - Space Media Network. All websites are published in Australia and are solely subject to Australian law and governed by Fair Use principals for news reporting and research purposes. AFP, UPI and IANS news wire stories are copyright Agence France-Presse, United Press International and Indo-Asia News Service. ESA news reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. All articles labeled "by Staff Writers" include reports supplied to Space Media Network by industry news wires, PR agencies, corporate press officers and the like. Such articles are individually curated and edited by Space Media Network staff on the basis of the report's information value to our industry and professional readership. Advertising does not imply endorsement, agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. Privacy Statement|