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European Countries Postpone Renewable Auctions, Delay Deadlines Due to Coronavirus

European governments are stretching auction and tender timelines and suspending penalties for delayed projects in the wake of the coronavirus outbreak.

Germany, France and Ireland have all taken action to ensure existing projects, at various stages of development, are not negatively impacted.

In the immediate term, this could see deployment in the first half of this year look a little lighter than expected. The good news is that governments and network operators are demonstrating a willingness not to let the COVID-19 outbreak erode the pipeline of projects, ensuring they are delayed rather than canceled.

Germany gives developers more time

Germany has seven scheduled auctions for both wind and solar power throughout 2020. So far this year, 400 megawatts of solar and around 675 megawatts of onshore wind proposals have been awarded capacity; another 2.9 gigawatts of onshore wind capacity is still up for grabs along with 1.4 gigawatts of solar. This year’s solar auctions have been oversubscribed.

Now the government body handling the auction process has stepped in to protect that process from any delays caused by the construction slowdown or as-yet-unseen supply chain problems.

For future rounds, bidding will continue as normal but the winners will not be revealed until the impact of COVID-19 has “calmed down.” Participants will be notified if they have been successful (so that winners don’t apply again with the same sites) but the results won’t be made public and the clock will not start ticking on project deadlines until they are.

Extensions on deadlines will be considered for projects already awarded capacity, but developers will have to apply for them on a case by case basis explaining the circumstances of the delay. Projects granted an extension will not be charged penalties.

The additional time and flexibility were welcomed by German utility EnBW.

“In view of the special situation, we would consider it appropriate for the Bundesnetzagentur to extend deadlines for the realization of projects already subsidized, in particular, as timely implementation — through no fault of the project developer — may not be possible,” an EnBW spokesperson told GTM.

EnBW has just begun construction on what will be Germany’s largest unsubsidized solar plant, Solarpark Weesow-Willmersdorf. So far work there has not been impacted.

“We are closely following the development and are in close contact with our suppliers in order to find solutions jointly and unbureaucratically in case of possible economic difficulties,” the company said.

Renewable auctions postponed

A number of countries have simply postponed existing auctions to buy developers more time. France has delayed its complex array of solar tenders by an average of two months.

Ireland was due to close qualification for the first round of its new Renewable Electricity Support Scheme (RESS) auctions this week. The first phase could support around 1 gigawatt of onshore wind were it to prove the cheapest technology. It also includes a carve-out for more than 300 megawatts of solar.

“In light of unprecedented challenges being experienced by RESS Applicants resulting from the COVID-19 pandemic, the RESS-1 Qualification Application closing date is being extended from Thursday 2 April 2020 to Thursday 30 April 2020,” a statement from the ministry involved explained.

Portugal is also putting a hold on its planned solar auction. A total of 700 megawatts had been on the table.

The U.K.’s next major renewables tender is not planned until September 2021. The design of the next round is currently undergoing a review and consultation with the industry. That process is scheduled to conclude in May. Community solar projects, which were still eligible for feed-in tariff support, have been given another six months to complete.

Some countries rolling ahead despite coronavirus

Some countries, in contrast, are looking to press ahead as planned — at least for now.

The Netherlands is auctioning 700 megawatts of offshore wind capacity, and the end of April deadline still holds. But Swedish energy giant Vattenfall — a big winner in previous Dutch offshore wind tenders — this week announced it will not participate in the upcoming auction, claiming it will focus on existing projects instead.

In Spain, both solar and wind had been enjoying breakneck deployment, via government auctions and a spate of unsupported activity. The big constraint had been grid access. The network operator Red Eléctrica told GTM that, for now, there was no need to look at extending projects grid connection windows.

“Red Eléctrica keeps on working to enable the integration of renewable energies in the electricity system. Therefore, we are still processing them with all due respect to the regular regulatory time limits within our capacity,” a spokesperson told GTM.

Jörg Peters, head of investor relations at the German IPP Encavis, said he expected to see other European countries, including Spain, to follow the German approach.

“I’m sure there might be some similar regulations in the rest of the European Union because of the [pursuit of] harmonization and because the European Investment Bank (EIB) would have a very strong focus on this,” he said, pointing out that the EIB finances a lot of Red Eléctrica’s infrastructure.

Source: Greentech Media