Abu Dhabi could grow its Sweihan solar venture to well more than 1 gigawatts after record low offers were submitted on Monday.
The procurement arm of Abu Dhabi Water and Electricity Authority’s got six offers for the forthcoming 350 megawatt solar photovoltaic (PV) plant in Sweihan, with an offer from a local company coming in at 2.54 US cents for each kilowatt-hour (kWh).
While that figure is 12 percent lower than the record lows came to in Chile a month ago, a radical new offer was put on the table from an Asian-led consortium. The consortium presented an offer for plant’s expansion to 1,170MW at an offer of 2.30 cents, as indicated by sources.
In any case, take note of that offers submitted don’t imply that the undertaking has been awarded, as officials will now assess the offers to guarantee diligence and financial capability.
The solar sector of the United Arab Emirates has been playing out on a worldwide field for a few years after Saudi Arabia’s Acwa Power, together with TSK of Spain, went to the front line and presented a triumphant offer of 5.84 cents for a 200MW phase for Mohammed bin Rashid Al Maktoum Solar Park in Dubai.
At the time this was a tremendous jump from what was viewed as average at around 8 to 9 cents.
It appears as if that cost is gone, in light of the fact that in June there were new lows in Dubai at 2.99 cents for 800MW.
It was broadly expected that Abu Dhabi would beat that rate, which brought about numerous companies hauling out.
At the start, ninety companies are interested, with that number decreasing to just 34 getting to be pre-qualified. Top names like TSK, Italy’s Enel, and Acwa, and Abdul Latif Jameel all pulled out over summer, leaving just seven in the competition. In the most recent move the French firm Engie left.
While some are worried that these rates will put a press on the sector, Acwa trusts that there is still space for further drops.
Paddy Padmanathan, Acwa CEO said that the bottom hasn’t been reached yet, but it’s close.
He said that there won’t be radical drops at the same time, however a steady slide later on. “Obviously the business sector is still ready to enhance, and given that the financing cost environment is staying static I’m happy to see this new ordinary,” he said.
Mr. Padmanathan said that the primary focus now should be on a system balance, which ought to highlight construction and efficiency gains in procedure. In any case, he warned of future concerns on liquidity toward the business sector.
The previous director of Masdar Clean Energy Frank Wouters, additionally concurred that the modest financing was brief. He thinks the low cost of capital plays a significant part and won’t remain so low forever. They’re still trying to figure out how to further reduce the cost of solar cells so there’s no reason why solar cost will ever increase again.
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