Portugal: New energy minister announces first RE auction for Q2 2019

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Newly appointed Portuguese State Secretary for Energy João Galamba seems more prone than his predecessor, Jorge Seguro Sanches, to provide utility-scale solar with a clearer, more efficient regulatory framework.

Indeed, while Sanches failed to provide actual details on his plans to grow solar through “a remuneration scheme based on market prices, and without subsidies paid by consumers, through the national electric system,” the new energy secretary has been clearer, with the announcement that the country’s first renewable energy auction is likely to take place in the second quarter of next year. The news was initally reported by Portuguese newspaper Publico.

This option, which had never been taken into consideration by Sanches, was previously recommended by the Portuguese renewable energy association APREN.

According to Publico, Galamba said the auctions will be structured similarly to those held in other European countries, and that they will ensure a more stable business environment, while making a difference between serious investors and speculators. In order to reach this goal, both shorter timeframes for the realization of projects and bigger penalties for missing them, should be introduced.

In a statement to pv magazine today, however, APREN said the government needs to release more details on the auction.

In addition to announcing the new auction, Galamba reportedly also said he intends to fight speculation in the large-scale PV segment.

Currently, this is an issue in neoghboring Spain’s large-scale solar industry. According to Alejandro Diego Rosell, managing partner of Spanish solar constructor, Energoya, it is particularly affecting the main distribution and transport nodes of the power network in the country’s southern and central regions.

“There are companies whose exclusive business is to secure those connection points and speculate with them, as they have no interest in developing the projects, only to sell them in an inflationary market,” he told pv magazine.

That the Portuguese grid may not have the required capacity to host all of the PV projects under development in the country is a well-known issue. In July, however, the country’s energy regulator Entidade Reguladora dos Serviços Energéticos (ERSE) approved a network expansion plan, which is expected to improve grid capabilities.

As for the connection of the solar plants, ERSE highlights two specific zones, the Alto Alentejo Zone and the Baixo Alentejo and Algarve Zone, both located in the southern part of Portugal. For these zones, the construction of two 400 kV transmission lines is planned.

Although construction has started on several “unsubsidized” solar parks in Portugal in recent months and more than 1 GW of these grid-parity projects have been approved, the viability of many of these projects is still uncertain.