New Record-Low Solar Price Bid — 1.3¢/kWh
I just wrote yesterday about the ongoing march downward of solar panel prices. Those low solar panel prices, along with cuts to other aspects of a solar power project, bring down the cost of both rooftop solar power and utility-scale solar power. Of course, the latter (utility-scale) can provide much lower prices than the former, due to economies of scale. (The benefit for rooftop solar power projects, on the other hand, is they can typically compete with retail electricity prices, rather than wholesale electricity prices.)
When it comes to utility-scale solar power, we have another world record to highlight and celebrate. Portugal recently held a solar power auction (in which power plant developers submit different bids for what price they can offer electricity under a new contract), and one of the bids broke the world record for the lowest solar power price.
The auction was an auction for 700 megawatts (MW) of solar power capacity, with granted awards totaling 670 MW. Of those, 483 MW also include an energy storage component.
The lowest winning bid was to supply solar electricity to the grid at a price of €0.01114/kWh (or ~1.327¢/kWh). The bid slightly beat the AED 4.97 fils/kWh (or 1.35¢/kWh) record-low bid in Abu Dhabi that we wrote about in June.
Naturally, with such smaller differences in price, changes in the exchange rate could make the projects swap places in the Lowest Solar Price Rankings. However, at the moment, that’s how the two projects compare.
“Consumers will guarantee savings of 559 million euros over 15 years,” the government of Portugal wrote.
“With an annual savings of 37.2 million euros, this value corresponds to a unit gain of about 833 thousand euros for each megawatt awarded, which represents an increase of about 80% compared to the unit gain obtained in the 2019 auction.”
This is not the first time Portugal has set the record for lowest solar power price bid in the world. It did so in 2019 as well. However, this is a major reduction despite being only a year later. “This tariff is about 25% lower than the lowest tariff obtained in the 2019 auction, considered at the date the lowest in the world (€ 14.76 / MWh),” the government added.
Portugal did not indicate who made the new record-low price bid. The electricity contracts are being awarded for 15 years. Update: the government did state (translated by Google): “Hanwha Q-Cells was the big winner of this second solar auction both in number of lots (6) and in awarded capacity (total of 315 MW).“
Notably, Portugal is a leader in plugin electric vehicle (EV) adoption. In the first half of the year, 12% of new automobile sales in Portugal were EV sales (fully electric vehicles as well as plugin hybrids). That made it the 6th best country in the world for plugin vehicle market share and 5th best in terms of fully electric vehicle market share. Combine those electric vehicles with the new solar power plants and you’ve got a lot of Portuguese people driving on sunshine.