Australia looks set to be the latest market in which the falling cost of utility scale PV will be demonstrated. From a list of 77 eligible projects, ARENA has selected a short list of 22 high merit projects, all of which have come in below the agencys threshold price of AU$0.0135/kWh (US$0.0937/kWh).
The 22 projects have submitted requests for funding totaling AU$322 million (US$223 million) and if all were developed would have a value of AU$1.68 billion (US$1.17 billion). ARENA has earmarked AU$100 million for the program. Given this it is likely around 250 MW of utility scale PV will be developed under the scheme.
Each project was able to demonstrate its cost of energy was below the threshold of $135 per MWh, with some projecting costs significantly below this threshold level, commented ARENA CEO Ivor Frischknecht. The strong interest and high-quality applications demonstrate Australia is serious about deploying large-scale solar and capitalizing on its abundant solar resources.
The projects will now be invited to submit a more detailed second round application. ARENA has indicated it will publish an aggregated analysis of the expressions of interest it received in round one next month, to increase transparency and awareness of utility scale PV costs and generation parameters in Australia.
The ARENA program is unlikely to immediately deliver demand to solar component suppliers, as the projects eventually green light will likely only begin construction in 2018.
ARENA says that some of the projects moving through to the second application round have also applied for project finance from the Clean Energy Finance Corporation (CEFC) under its complimentary AU$250 large scale solar program.
The CEFC issued a statement saying that the levels of investor interest in developing PV power plants was encouraging. CEFC CEO Oliver Yates noted that the CEFC would be in the position to provide some debt financing for the projects.
The Australian federal government to date has not made statements saying that it has changed its official position that it is backing away from moves to see both ARENA and the CEFC abolished. Government legislation to do so has been blocked by the Senate on a number of occasions. When Prime Minister Malcolm Turnbull toppled Tony Abbott in 2015, the two agencies were brought under the control of the Environment Minister Greg Hunt.