Record Floating Solar Price in Portugal Improves Prospects in Spain

  • Hybrid technology designs have produced record floating solar prices on hydroelectric dams in Portugal, providing lessons for Spain as it opens its waters.

September 12 – The first commercial floating solar energy auction in Portugal has resulted in a record negative price that portends bright prospects for water-based projects across Europe. Floating solar business grows as land becomes scarcer and Europe’s decision to increase renewable energy targets after Russia’s invasion of Ukraine prompted governments to unlock new project opportunities.

EDPR offered a negative price of 4.13 euros/MWh ($4.50/MWh) for 70 MW of floating solar power on its giant Alqueva hydroelectric dam combined with 14 MW of additional solar capacity and 70 MW of wind power.

The record price was achieved thanks to the scale and combination of technologies, a spokesman for EDPR, a subsidiary of Portuguese utility EDP, told Reuters Events. Going online in 2025, Alqueva will be the largest floating solar power plant in Europe and will win market prices for other solar and wind components to compensate for the negative floating solar price.

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Floating solar is one of EDP’s “biggest bets”, the EDPR spokesperson said. EDP ​​operates nearly three-quarters of the country’s hydropower capacity, providing readily available grid connections.

Other auction winners included Spanish utility Endesa, which secured 44 MW of floating solar capacity in a hybrid project at EDP’s Alto de Rabagao dam, and Portuguese developer Finerge, which secured rights for 38 MW of floating capacity on three tanks.

Endesa’s €115m Alto de Rabagao project is the group’s first large floating solar farm, paving the way for future growth in Spain.

The Spanish government is about to launch its floating solar market by rolling out new regulations for projects on public aquatic spaces. The first projects are likely to be deployed on hydroelectric dams, allowing developers to acquire scalable and operational learnings that could be applied to other water bodies such as wastewater treatment plants and disused mines.

Technological compatibility

Asia is currently the largest floating solar market, but business is growing in Europe and the US holds huge potential. Floating solar power on man-made bodies of water could eventually provide 10% of electricity generation in the United States, the US National Renewable Energy Laboratory (NREL) said in a report.

MAP: potential floating solar capacity in the United States, utility rates

Source: NREL report “Floating photovoltaic systems: assessment of the technical potential” (2019)

Portugal’s auction offered competitive pricing because developers could use the same grid connection point for multiple renewable energy technologies, including battery storage, an Endesa spokesperson said.

Endesa’s Alto Rabagao project includes 49 MW of battery storage and 48 MW of wind energy and will offer a load factor of “over 40%, well above the typical load factor” of solar or wind projects, said the spokesperson.

The contracts awarded at the auction apply to the first 15 years of floating solar generation and the energy produced by the other technologies can be sold at the daily market price on the Portuguese MIBEL market. The average day-ahead MIBEL price in 2021 was 112 euros/MWh.

Portugal has also simplified the bidding process by granting both grid connection and water surface rights for 30 years, Endesa noted, removing licensing hurdles that are delaying many projects. solar and wind power in the United States and Europe.

To reduce the backlog, Spain and Portugal are implementing temporary rules to reduce permitting times for onshore solar and wind projects and European Union leaders agreed new rules that require members to nominate zones for faster approvals.

Dam ready

EDP ​​was an early player in floating solar power, seeking to take advantage of growing solar and wind expertise and its large fleet of hydropower capacity.

The company benefits from significant technology learnings, a test floating solar project completed at Alto Rabagao in 2017 and 5MW capacity at Alqueva expected to come online in July.

The 5 MW Alqueva project includes 12,000 solar panels and 2 MWh of battery storage. The project would allow EDP to optimize a “new hybridization model” for photovoltaic hydropower plants, Miguel Patena, director of innovation and technology at EDP Production, told Reuters Events in 2020.

EDP ​​has found new mooring solutions that will make “future large-scale projects commercially competitive,” he said.

Floating solar avoids land acquisition costs and lower temperatures near the water surface can increase panel efficiency, but efficient foundations are essential.

Changing water conditions on large hydroelectric dams pose design challenges and developers like EDP have worked with engineering groups to develop special mooring and anchoring systems that can adapt to changes in water depth and temperature.

Spain next

Spain’s new floating solar regulations will encourage development by clarifying project terms and risks, Endesa said.

Spain has about 100 state-owned reservoirs, including hydroelectric dams and non-hydroelectric facilities, and is analyzing responses to the proposed floating solar regulations following a public consultation in April. Spain installed 3.3 GW of solar capacity in 2021 and aims to build 30 GW of new solar by the end of the decade.

The Spanish government is keen to back floating solar because it offers greater energy efficiency through the cooling effects of water and less dust accumulation than land-based projects, an energy ministry spokesperson has said. and environment MITECO.

Spain is expected to offer 25-year concessions for floating solar projects and developers will be required to provide grid connection permits in project proposals, favoring hydroelectric dams over water sites without grid capacity.

MITECO plans to implement the new rules as soon as possible, but developers are still waiting for a clear auction schedule.

Floating solar is still an emerging technology and therefore “one must proceed with caution”, the ministry spokesperson said.

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