Portugal’s solar tenders draw 300 potential bidders

Governo tem 300 interessados nos leilões para solar https://t.co/DeZWY5NnCm

— Joao Galamba (@Joaogalamba) June 4, 2019

“The government has 300 parties interested in solar energy auctions.” With a single tweet linking to an article in Sapo, a Portuguese financial newspaper, the country’s state secretary for energy, João Galamba, showed just how much attention the country’s first procurement exercise for solar energy has already drawn. He has since added that he will soon meet with approximately 300 prospective bidders at the National Laboratory of Civil Engineering (LNEC).

“There is everything from small- and medium-sized companies to large companies, both Portuguese and foreign, financial companies, investment funds or law firms representing clients,” Galamba said in a recent meeting with journalists.

More details on June’s tender

According to Sapo, Galamba has revealed that the Portuguese government will allocate 1.4 GW of solar power in the first auction to be held in June, and not 1.32 GW as previously announced. It must be remembered, however, that the planned capacity for the procurement exercise had already been scaled down from an initial target of 1.7 GW.

Of the 1.4 GW of capacity to be auctioned off, 750 MW will be assigned to projects in central-northern Portugal’s Centro region, while another 340 MW will be assigned to the Lisboa e Vale do Tejo region, in the central part of the country. Sunnier regions farther to the south, such as Alentejo and Algarve, will only be allocated 235 MW and 30 MW, respectively.

Project proposals, according to the Publico newspaper, must be submitted between June 17 and June 30. Developers will be given the chance to present two kinds of offers: one with a fixed price below a ceiling price, which will be lower than the market value, and another with a variable tariff, which includes a requirement to pay compensation to the electricity system. Winning projects will be granted 15-year PPAs.

Second auction in January

The June auction is expected to pull in about €1.12 billion of investment, with an average investment of around €800,000 per MW installed, Galamba said during the press conference. At the end of May, Galamba had also revealed that a second 700 MW solar auction will be held in January.

The Portuguese authorities had approved around 1.2 GW of utility-scale PV projects by late January of this year. Meanwhile, construction has also started on several “unsubsidized” solar parks in Portugal.