By
Bloomberg New Energy Finance on 22 February 2017
Source: Trade Arabia
Saudi Arabia is inviting bidders to qualify for its first renewable energy tender by 20 March. The world’s top crude exporter is laying the groundwork for a rollout of wind and solar power, which will allow it to reduce the amount of oil used domestically and, it hopes, will stimulate economic development in clean energy.
The selected parties will be announced by 10 April and will be able to present their offers for the projects from 17 April to the end of July, according to a statement by the energy ministry. As much as 700MW of wind and solar power will be available in this tender – the first stage of Saudi Arabia’s plan to develop almost 10GW of renewable energy by 2023.
Auctions were also trending in the news in India, after a World Bank-backed auction on 10 February produced a record low bid of 3.30 rupees (5 US cents) a kilowatt-hour for solar PV. The auction for 750MW of power in Madhya Pradesh state included payment guarantees, annual tariff increases and power purchase agreements designed by the International Finance Corporation. All of which helped boost confidence in the projects for developers.
The lower electricity tariffs produced by India’s auction will be attractive to the country’s indebted state-run power retailers, and could help them improve their finances, according to BNEF.
The trend for allocating renewable energy capacity through competitive auctions may spur developers to scale up the size of projects in key European markets, according to state lender Norddeutsche Landesbank Girozentrale. In an effort to meet the low tariffs demanded of auction winners, developers and financiers may seek to save on maintenance and grid-connection costs by building bigger wind parks, according to a NordLB spokesman.
These tactics may be in evidence in Germany’s auctions for 2.8GW of onshore wind capacity this year, and France’s plans to put 3GW of capacity under the hammer by 2019.
In other wind industry news, Siemens announced that it would close a wind turbine factory in Denmark last week, eliminating 430 jobs in the process. The factory in Engesvang produces smaller turbine blades and hasn’t been able to meet the growing demand for larger blades, including those needed for offshore wind farms.
Canadian utility Enbridge is joining up with Germany’s Energie Baden-Wuerttemberg on a EUR 1.8bn ($1.9bn) wind farm under construction in the German North Sea, according to a statement last Friday. EnBW is selling a 49.9% stake in the 497MW Hohe See wind farm to the Calgary-based firm, and the two companies will work on the project together. It is expected to start operations in August 2019.
In other news, climate change could trigger resource and border conflicts and in the worst cases precipitate war, according to top European and United Nations officials who spoke about the military threat of global warming at a world security conference in Munich last weekend.
“Climate change is a threat multiplier that leads to social upheaval and possibly even armed conflict,” the UN’s top climate official, Patricia Espinosa Cantellano, said at the conference. Climate change and population growth were named as the two most serious “megatrends” threatening international peace and stability by Secretary General Antonio Guterres.
The delicate balance between protecting the Arctic and extracting fossil fuels was discussed at the event, as was the economic threat posed by European renewable energy to Russia’s oil and gas supply.
The question of whether President Donald Trump pulls the US out of the Paris climate accord was also discussed. “The response of the international community will be significant,” in the ultimate decision of whether or not the agreement is abandoned by the US, said US Democratic Senator Sheldon Whitehouse.
If no action is taken to tackle global warming, as much as 70% of Alpine snow could disappear by the end of the century, according to new research by the European Geosciences Union. The paper, which used three-dimensional modelling to understand the effects of global warming on mountain snow coverage, said that the Alps would lose about 30% of snow cover by 2100 even if countries limit temperature increases to below 2 degrees Celsius. So it might be time to grab your skis and hit the slopes while you still can.
Source: BNEF. Reproduced with permission.
http://reneweconomy.com.au/saudi-arabia-makes-first-steps-10gw-renewable-energy-rollout-19679/
Oil exporter Saudi Arabia starts hunt for solar, wind firms
A Saudi man walks on a street past a field of solar panels at the King Abdulaziz city of Sciences and Technology, Al-Oyeynah Research Station. (File photo: Reuters)
AFP, Riyadh Monday, 20 February 2017
Virtually all of the kingdom’s power currently comes from crude, refined oil or natural gas.
But as part of the Vision 2030 economic reform plan to wean the kingdom off oil, it has set a target of 9.5 GW of renewable energy by 2023.
“This marks the starting point of a long and sustained program of renewable energy deployment in Saudi Arabia,” Khaled al-Falih, Minister of Energy, Industry and Mineral Resources, said in the statement.
He said this will not only diversify the kingdom’s power mix but will also catalyze economic development.
RELATED STORY: Saudi Arabia targets 9.5 gigawatts of renewable by 2030
Reaching the 9.5 GW target will cost between $30 billion and $50 billion, Falih said last month.
Companies will have until March 20 to file documents for bidding pre-qualification. Those which are successful will be announced by April 10.
Formal proposals can then be presented until July, the ministry said.
http://english.alarabiya.net/en/bus...Arabia-starts-hunt-for-solar-wind-firms-.html
Why Saudi Arabia's $50bn renewable energy programme is credible
The plan will set new benchmarks in competitiveness, commercial attractiveness and execution.
By
Ahmed S. Nada
Sunday, 26 February 2017 2:20 PM
Spotlight the kingdom first announced plans in 2012 for solar power to account for up to 23 percent of its energy mix but it now says 14 percent.
When the Kingdom of Saudi Arabia’s Renewable Energy Project Development Office (REPDO) released its request for qualification (RFQ) for 700 megawatts (MW) of solar and wind energy generation assets last week, there was a collective scramble by the renewable energy industry to examine its contents.
This was, after all, the much-anticipated launch of the kingdom’s planned 9.5-gigawatt (GW) renewable energy program, one of the largest opportunities available to the industry today.
On the day that the RFQ was released, His Excellency Khalid A. Al Falih, Saudi Arabia’s Minister of Energy, Industry and Mineral Resources, reiterated his goal to make the program “the most attractive, competitive, and well-executed” of its kind in the world.
What’s more, is that his comments were backed by an RFQ that is clearly designed to ensure that only the industry’s most financially and technologically credible players make it to the next stage in the procurement process.
For those of us in the renewable energy business who have consistently engaged with numerous stakeholders in the kingdom over the past few years, this was a welcome assurance from the highest levels of government.
It was also apparent that Saudi Arabia, with the support of its advisors, is making a concerted effort to avoid the pitfalls that other fast-emerging markets have had to endure when rapidly ramping up their renewable energy portfolios.
For instance, by putting in place stringent pre-qualification criteria, the kingdom is, in effect, avoiding the risk associated with inadvertently including inexperienced, unqualified bidders in the procurement process.
Critically, there are indications that the later stages of the process will mandate that bidders source their technology from bankable, top-tier suppliers that have the financial strength to stand behind their performance guarantees and product warranties.
At a time when the stability of a number of photovoltaic (PV) module manufacturers is being called into question, this will, once again, lower risks while boosting the financial credibility of the assets being added to the programme.
There is other evidence that the kingdom is effectively managing risk, the size of the tender being the most apparent one. While REPDO could just as easily have tendered larger projects, it has prudently chosen project sizes that allow for important learnings to be carried forward through the remaining phases of the programme, while also sufficiently benefiting from the economies of scale.
It has also underpinned the programme’s success by funneling it through a single department — REPDO is an office of the Saudi Ministry of Energy, Industry and Mineral Resources — rather than the previous approach of giving numerous stakeholders the task of executing.
It is clear that the tender for 300MW–700MW of solar PV and 400MW of wind is just the beginning, with immediate plans to rapidly scale the kingdom’s renewable energy portfolio to just over one-third of the 9.5GW target.
Our hope is that, in order to supplement the focus on utility-scale power generation, Saudi Arabia will also take a closer look at tapping into the potential for large commercial and industrial (C&I) solar applications. An evolutionary step towards Saudi Arabia’s renewable energy goals would be the implementation of ‘wheeling’ policies that will allow independent power producers that own renewable energy assets to supply clean electricity to their customers using the state-owned grid.
Hypothetically speaking, in such a scenario a privately-owned solar power plant could sign a commercial Power Purchase Agreement (PPA) with a petrochemical processing facility or a large dairy farm located 100 kilometres away. The solar power plant will supply electricity to the national grid, offsetting the conventionally generated energy consumed by the petrochemical facility or farm, while the grid operator benefits financially from a wheeling fee.
If structured well, such a program could provide the incentive needed to remove energy subsidies for certain industries, while allowing them to benefit from the new economic realities of solar electricity.
Mature renewable markets that have successfully initiated their own energy transitions will testify to the fact that a multi-pronged approach is needed to deliver on targets and to do so cost-effectively; in a majority of instances, a multi-pronged strategy includes utility-scale, small-scale residential, and C&I-focused programs.
It is now evident that Saudi Arabia has a credible renewable energy program that is designed to ensure that the country builds up a reliable, cost-competitive portfolio of world-class power generation assets. It has achieved this at its own pace, undeterred by the naysayers and speculators, and there is no doubt in my mind that its success will be underpinned by a determination to achieve its well-defined goals, but also to set new benchmarks in terms of competitiveness, commercial attractiveness and execution.
Ahmed S. Nada,Vice President and Region Executive for First Solar in the Middle East
http://www.arabianbusiness.com/why-...able-energy-programme-is-credible-664655.html
