ARENA seeking large scale solar projects under $135/MWh

The Australian Renewable Energy Agency says it is seeking large scale solar projects that can produce energy at a cost of $135/MWh as it calls for tenders for its first $100 million funding round for the technology.

ARENA says expressions of interest must be registered with ARENA by October 9 and submitted by November 2 this year.

The ARENA tender is one of a number of key tenders for solar projects taking place in the next 12 months, in what is seen as a big move to lower the cost of the technology and make it competitive with wind energy, and ultimately fossil fuels.

The Abbott government has expressed a preference of solar over wind energy, and some analysts predict that large scale solar could take up the bulk of the reduced renewable energy target.

The ACT government is to award a tender for 50MW of “advanced” solar technology that includes storage, Ergon has called for tenders of 150MW of renewable energy capacity in Queensland, including solar, and the Queensland government is to hold a tender for 40MW of large scale solar capacity.

ARENA says the key objectives of the Advancing Renewables Programme (ARP) – which will support up to 200MW of large scale solar – is to further reduce the cost of large-scale solar PV and provide a clear path for the technology to become competitive with other commercially viable forms of power generation in Australia.

The agency has set a benchmark of $135/MWh for its tender and wants successful bidders to demonstrate that they can deliver large scale solar at a cost below that.

It has previously said that it intends to help bring down the cost of large scale solar to between $80-$100/MWh by 2020 – which would be parity with wind energy. But some private players think it can come down more and faster.

The large-scale solar competitive round is open to activities that fit within the following parameters:

• Projects must generate all their electricity from solar PV
• Projects must meet or exceed the minimum project size of 5 MW (AC)
• Total grant funding requested for a project must not exceed $30 million
• Projects must be connected to the National Electricity Market (in the eastern states) or South West Interconnected System (in Western Australia)
• Projects must not involve behind the meter elements.

Further details are expected to be released at the Energy Disruption conference in Sydney this week. ARENA says that any queries be submitted to proposals (@) arena.gov.au.

Australia has a number of large scale solar projects, including the completed 102MW Nyngan project and the under-construction 52MW Broken Hill project, both supported by ARENA and the now defunct Solar Flagships program.

A 57MW tracking plant is being built at Moree, while the ACT has commissioned three solar projects, with one, Royalla, being completed and two others under construction of in the planning phase. A 10MW solar plant was also built in West Australia.