Solar farms run at a loss due to curtailment and poor weather

Two solar farms owned by Thai energy company Banpu have returned a combined loss in the first two quarters of 2025, with the owner putting the blame on poor weather conditions and curtailment.

Banpu Energy Australia, which also owns coal mines in Australia and which has recently expanded into battery storage projects, bought the Manildra and Beryl solar farms – with a combined capacity of 167 MW – in June, 2021, for $98 million.

In the last six months however, the two solar farms returned a small loss of $2.1 million, with $1.4 million in the latest quarter and $0.7 million lost in the March quarter, with the latest result coming even after a $6.2 million gain on derivatives, according to its recent analyst presentation.

It blamed “lower power sold due to curtailment and unfavourable weather conditions” in both quarters. It resulted in a significant fall in output, 10 per cent in the latest quarter and 21 per cent in the first quarter.

In the June quarter last year, the company reported earnings of $5 million from the two solar farms, although in its first quarter of 2024 the loss was $4.5 million, although that was after a derivative loss of $5.7 million.

The poor financial performance of solar farms is not a big secret, but rarely revealed in detail because so few of their owners are publicly listed, or are so big they don’t bother providing details of individual assets.

Another listed company, the Philippine-based Acen Renewables, which owns the two biggest solar farms in NSW at New England and Stubbo, revealed its revenue and earnings from its Australian solar assets had fallen in the first half, despite an increase in output thanks to the ramping up of the Stubbo facility.

See: Earnings from biggest solar farms in NSW fall, despite higher output

Solar farms are being hit by the twin impacts of low prices and curtailment, which often go hand in hand because many solar projects are obliged to, or choose to, switch off production when prices fall below zero and the value of the LGC certificates they produce.

This has led to a major rethink about how these projects are developed in the future. Some energy companies are focusing more efforts on battery storage, such as Banpu which has bought a 50 pct stake in the Woreen battery in Victoria from EnergyAustralia, and more recently bought the Kerang battery project.

Other developers are choosing to focus on solar battery hybrids, where solar and batteries are located behind the same meter, allowing the solar output to be stored and then sent to the grid when demand and prices are higher, as has been seen with the Cunderdin hybrid in Western Australia, the biggest so far in the country.

See: The solar farm that winds down at dusk, charges up for dinner and is still generating at midnight

Other solar hybrids are being built at Fulham in Victoria and in NSW, and others are planned, including a facility next door to Banpu’s Kerang battery project that is looking to combine a 161 MW_DC solar farm and an AC-coupled 55 MW, 2-hour battery.

See: Banpu buys another Australian big battery project, as solar hybrid next door gets grid go-ahead

And also: Big Battery Storage Map of Australia