Denmark launches second solar-wind auction

Danish Energy Agency the Energystyrelsen has issued a second technology-neutral tender for large scale solar and wind power plants.

The agency said it had allocated DKK258 million ($38 million) for the tender, after spending DKK254 million on the previous procurement exercise, which was finalized in December.

A limit for the feed-in premium to be paid to successful project bidders on top of the market electricity price has been set at DKK0.06/kWh, more than halving the ceiling price of DKK0.13/kWh set for last year’s auction.

Bids must be submitted by November 27. “Projects must be connected to the grid within two or four years after contract signing, depending on whether it is an installation on land or the sea,” the Energystyrelsen stated.

Last year’s exercise

In the first auction of the kind, 20-year power purchase agreements were awarded to three solar plants with a combined generation capacity of 104 MW and three wind facilities with 165 MW of capacity. The Energystyrelsen received 17 bids in that procurement round – for 280 MW worth of solar capacity and 260 MW of wind. The weighted average price premium of the winning bids was DKK0.0227/kWh.

The national budget for renewables auctions is DKK842 million with a further DKK4.2 billion set side for for 2020-2024. Denmark supports commercial and industrial PV through dedicated tenders for projects with a generation capacity of up to 1 MW.

At the end of 2018, Denmark had installed PV capacity of around 1 GW, with around 92 MW of new solar added last year.