Portuguese Solar Auction Break Low Price Record
Time:2019-09-02 11:28:05
2019 was called the first year of PV grid parity. In this year, domestic policies on grid parity and bidding grid have been implemented, and grid parity is approaching. From a global perspective, grid price of PV power generation continues to decline, which frequently refreshes the low-cost records. PV has become the most economical energy in many parts of the world, which will benefit more areas in the future.

▲  Large ground PV power station

According to PV-Tech report, João Galamba, State Secretary of the Portuguese Ministry of Energy, confirmed that the lowest bid price of the PV tender was 14.76 euros / MWh (about 1.644 cents / KWh) in July in Portugal,which has once again set the lowest price for the construction of global PV power plants.

▲  Selpa solar park in southern Portugal

Since this year, with the continuous decline in the cost of electricity, the price of PV power generation has repeatedly set a world record. On June 28, in the A-4 renewable energy auction in Brazil, PV created a new world record for PV price with an average bid price of 1.75 cents / KWh (about 0.12 yuan). In less than a month, its price has renewed a record, and the cost reduction of PV power generation has once again broken through the world's perception.

▲  PV system cost decline trend chart

there are several factors causing the cost reduction of PV power generation. First, the efficiency of PV power generation continues to increase. Now the production efficiency of single-junction cells has generally reached about 22.5%. In the future, double-junction cells can reach 35%. Increased efficiency can dilute the entire process cost.

▲  LONGi high efficiency monocrystalline PERC cell efficiency broke the world record

In addition, there are still a lot of room for improvement in the production technology of PV products. A certain progress in each link can often dilute the full cost of the upstream link. The promotion and application of technologies such as bifacial power generation and sun tracking system can continue to promote power generation and the cost reduction. There are still many such technologies and ways to reduce costs and increase efficiency.

▲  LONGi's new high efficiency monocrystalline module Hi-MO4 was unveiled in SNEC 2019

Meanwhile, with the gradual decline in the required return on social capital, it will also contribute greatly to the cost reduction of wind power and PV power. At present, many countries in the Middle East and South America have already had the on-grid price below 2 cents. In the future, the cost of PV power in China will most likely fall to below 1 cent.

Under the trend of declining technology-driven costs, PV power generation in the future can fully meet the alternative conditions of traditional energy from the economical side. Under the impact of lower LCOE of PV power, t China coal-fired power projects is losing its economy, and 2025 will become an important historical turning point.

On the 4th of last month, Bloomberg New Energy Finance released the "2019 New Energy Market Long-term Outlook Report" (referred to as "NEO Report") in the seminar. Yan Dong the chief author of Chinese market part in the report said that at present, the LCOE of new PV projects in China was nearly same with that of new coal-fired power projects. He predicted that in the next two or three years, the LCOE of new onshore wind power and PV power will be lower than the operating cost of the built coal-fired power. By 2025, the LCOE for new PV projects will be 30% lower than that of new coal-fired projects.

▲  Luan Dong, Lead author of NEO Report

 “This means that will not be economical to meet the new power demand by using the new coal-fired power project after 2025. From the economic point of view, China will not have to build new coal-fired power projects after 2025.”
- Luan Dong, Lead author of NEO Report
With the reduction of coal-fired power projects, wind power and PV will surely take the lead in China power system.

From the global perspective, PV also has a broad space for development. At present, only about 20% of the world's electricity comes from renewable energy. It is generally believed that low-cost green power is becoming the trend through analysis.

▲  A corner of large PV ground power station

The 21st Century Renewable Energy Policy Network found that 114 energy experts have reached an “overwhelming consensus” around the topic of “the low-cost renewable energy dominates the electricity market” through a survey. Many surveyed experts believe that renewable energy costs will continue to decline, and it will be easy to offset the cost of all fossil fuels by 2027. By the middle of this century, the world will easily transform into a 100% renewable energy structure.