As part of a major push into big solar projects, which have been slow to take off in Australia because of policy uncertainty, ARENA is making available $100 million in grants, CEFC is offering up to $250 million in finance, while Ergon and the Queensland government have separate tenders in progress.
RenewEconomy understands that several new international players have been drawn to the Australian market, reversing a trend that saw some pack up and leave under the policies of the federal government under the leadership of Tony Abbott.
There have been several gigawatts in capacity proposed for the tenders, which is not surprising given that the call for expressions of interest by the ACT government for 50MW of next generation solar with storage drew nearly 1 GW of proposals.
In Queensland, alone, there are more than 2.5 GW of large-scale solar projects with local council approval, merely waiting for contracts with local utilities, or financing to enter the merchant market.
RenewEconomy has been told that nearly all of the proposals for the ARENA/CEFC tender are for fixed tilt, solar PV projects, with Queensland accounting for most interest, closely followed by New South Wales and Western Australia.
Interestingly, there was a fair bit of appetite for merchant projects, where the developer takes the pricing risk by selling into the wholesale market, although these were focused on Queensland and Western Australia, where the wholesale prices, and solar resources, were higher.
That suggests that the results could be well below the $135/MWh cut-off point identified by ARENA. Indeed, solar auctions in India, the US, and Chile show bids of between $US50 and $80/MWh, but Australias costs are higher because there is not much of a supply chain here.
The Solar60 program the 60 MW of capacity to be auctioned by the Queensland government under its attempts to kick-start the large-scale solar industry in the state has also attracted strong interest because of the 20-year power purchase agreements on offer.
Ergon Energy, meanwhile, has also closed its offer of 150 MW of large-scale renewables, and is sorting through the applications. It expects to whittle down a short list soon, with the intention of entering into contracts before the end of the year or in early 2016.
A spokesperson for Ergon Energy said the tender had sparked interest from a range of projects across regional Queensland, and the total megawatts proposed was well in excess of requirements.
There was no indication of technology, although there have been numerous analyses from groups such as Bloomberg New Energy Finance to utilities such as Origin Energy that solar makes a lot of sense in Queensland because of the solar resource and the high wholesale prices.
Renewable energy certificates have also been trading at or below the $70/MWh mark, more than enough for solar projects to match on costs although the newness of the technology in Australia means that most financiers want to lock in long-term contracts from customers.
The Ergon spokesperson said the Expressions of Interest received included new renewable energy projects offering to supply electricity and large-scale renewable energy certificates. An announcement will be made soon regarding shortlisted proposals.
Ergon Energy Retail will carry out a thorough assessment of these submissions and will only partner with companies that have a solid reputation in this space, the spokesman said.
Successful proposals will need to demonstrate they will contribute significantly to Ergon Energy Retail commitment to source even more renewable energy for its customers.
The ARENA projects are unlikely to be contracted until towards the end of 2016, according to its documentation. Spokespeople for ARENA and CEFC were not able to comment.
This article was originally published in RenewEconomy and is republished with permission.