Chinese companies are looking to expand in Russias burgeoning solar energy market.
The Russian government has received a record number of applications to build solar power plants in Russia as part of the first stage of the tender for construction of renewable energy facilities in the country the period from 2015 to 2018. The auction is expected to take place in July.
Local and international companies, including a number of unnamed Chinese firms, have so far submitted applications for the construction of 785 MW of solar power installations one and a half times more than the allocated quota.
Under the terms of competition, the projects with the lowest costs will win the tender. Participants must ensure that they use locally made equipment in Russia at the level of no less than 50% in 2015 and at least 70% in from 2016 to 2018.
The winners of the auction will receive a guaranteed 14% rate of return on their investment for over 15 years.
Chinese group Amur Sirius, a unit of China’s Harbin Power Equipment, submitted the largest bid for 220 MW, according to a spokesperson for the Russian Ministry of Industry and Trade. At the same time the second largest application for 190 MW was filed by Avelar Energy Group, owned by Russian billionaire Viktor Vekselberg, while local consortium Solar Energy Group of Companies filed for the third largest bid for 160 MW.
Solar Energy won a tender for the construction of 270 MW of solar power projects last year, according to Viktor Antonov, the companys director of development. By 2016, the company plans to fully localize the production of solar modules.
Among the other potential investors are a number of Chinese companies whose names have not been disclosed.
The conditions for participating in the tenders were significantly eased by the Russian government this year by eliminating the requirement of guarantees from large energy companies to potential investors who own less than 2.5 GW of generation.