Europe leads world in solar auctions
European countries have awarded 8.1 GW of the 17.4 GW of photovolataic (PV) power auctioned globally in 2017, according to GTM Research. South Asia, the second largest market for tendered PV, awarded 5 GW of PV in the same period. A total 48 national markets offer solar tendering or auction schemes, while another 27 nations are debating whether to plan tenders and auctions, the study found. “Mature solar markets including Germany, Japan and the United Kingdom have used competitive procurement as a market-capping mechanism to remedy subsidy budget deficits, market saturation, curtailment and grid-balancing issues, and high costs,” said Ben Attia, GTM Research solar analyst.
According to the latest Global Solar Demand Monitor, GTM Research is now tracking 17.4 gigawatts of confirmed solar PV tenders in auctions across the globe. The report highlights that 9.6 gigawatts will be awarded in the third quarter of 2017 alone.

With 8.1 gigawatts confirmed, Europe leads as the region with the greatest share of tendered solar PV. South Asia, led by India, ranks second with 5 gigawatts.

FIGURE: Timing and Award Volume of Confirmed Solar PV Tenders

Source: GTM Research Global Solar Demand Monitor, Q2 2017

As auctions continue to proliferate, the pipeline will only grow larger. According to GTM Research, tendering or auction schemes are currently in place in 48 national markets, and an additional 27 nations are currently discussing or planning tenders and auctions.

“Mature solar markets including Germany, Japan and the United Kingdom have used competitive procurement as a market-capping mechanism to remedy subsidy budget deficits, market saturation, curtailment and grid-balancing issues, and high costs,” explained Ben Attia, GTM Research solar analyst and lead author of the report.

Similarly, emerging markets with little to no installed capacity or market history are using tender programs to procure cost-competitive renewables without subsidies.

“High-growth markets like India and Mexico have used the same mechanisms as a scale-up engine to centrally allocate projects on weaker grids, provide credit and offtaker guarantees or assurances, and create a low-cost, no-subsidy multi-gigawatt pipeline,” Attia added.

In 2017, driven in part by auctions and tenders, global demand will exceed 80 gigawatts for the first time, though year-on-year growth will fall from 2016’s 55 percent to a more sustainable 4 percent.



FIGURE: Global PV Demand, 2015-2022E



Source: GTM Research Global Solar Demand Monitor, Q2 2017

***

Stay up to date on global solar trends with a subscription to GTM Research's Global Downstream Solar Service. Learn more here.