L R AS Published on Monday 18 January 2021 - n° 346 - Categories:Thread of the Week
Le Fil de la Semaine n° 346 of 18 January 2021
THIS WEEK'S NEWS HIGHLIGHTS
Other interesting articles :
THE DEVELOPMENT OF THESE TITLES
* EDF's demerger project did not take into consideration local authorities
The EDF Group's proposed demerger continues with discussions between France and the European Union. This project, named Hercules, plans to split the group into three : a°) nuclear energy which would be renationalised within a part called EDF Bleu; b°) the hydraulic activities with the dams would be part of EDF Azur, with a status of quasi-regulated; c°) the renewable energies would be part of EDF Vert. This activity would receive private capital and eventually be listed on the stock exchange.
This reorganisation is explained by the significant need for capital in the nuclear part of the business due to the increase in the lifespan of the plants from 40 years to 50 years, the financing of the EPRs under construction (and possible other EPRs), and the decommissioning of the plants currently in operation. Financing would be better secured if the French State were the guarantor of the nuclear industry's borrowings. This could also provide a revenue guarantee on the sale of nuclear electricity. The Arenh mechanism should be reformed.
This draft mechanism did not take into account the fact that electricity distribution networks are the property of local authorities. They were at the origin of their pre-war deployment, in the form of public service concessions or régies. The creation of EDF in 1946 strengthened the place of local authorities in the electricity distribution system. Where Régies existed, the legislator preserved local initiative in the form of local distribution companies. Elsewhere, the operation of the network was entrusted to EDF (then EDF/Enedis) in the form of a public service concession. However, local authorities remain the organising authorities for the supply of electricity at the Regulated Sales Tariffs.
One of these public authorities, SIPPEREC, which accounts for more than 5% of French electricity consumption, represents 84 local authorities and nearly 4 million people in the Paris region. This organisation is opposed to this project, pointing out that its local role has not been taken into account in the reorganisation plan and raising three concerns. A°) The price of electricity paid by the consumer. B°) The quality of the service and particularly of the network, which requires maintenance and therefore investments. C°) The development of renewable energies and their coherence with the network.
Hence the willingness of these conceding authorities to make themselves heard by the public authorities. They threaten to take over the management of the local networks, to organise the supply of regulated sales tariffs, and thus to ensure that the status of the electricity and gas industries is maintained for all employees concerned. The local authorities in charge of managing the energy networks want to remain at the heart of the reorganisation of the electricity sector.
PV Magazine of 14 January 2021
Presentation by Finergreen of the call for tenders "solar ZNI" tranche 3 and published by the Ministry on 23 December 2020
Presentation by Finergreen of the call for tenders "Solar Innovations" tranche 3 and published by the ministry on 23 December 2020
Three lawyers provide their views on possible courses of action for producers who would be affected by the government and legislative decision to review contracts signed before 2011.
Tecsol of 10 January 2021
Total acquires a 50% interest in a 2.35 GW-ac solar portfolio in operation held by AGEL and a 20% stake in this company for a total amount of $2.5 billion.
AGEL would be the world's leading solar developer. It has 3 GW of renewables in operation, 3 GW under construction and 8.6 GW under development. AGEL wants to reach 25 GW of power generation capacity from renewable energies in 2025.
Total and Adani already have a partnership in the distribution of gas in India since 2018 with Total's participation in Adani Gas.
Press release of 18/01/21
Neoen has applied for a permit to build a 500 MW/1000 MWh battery to be constructed west of Sydney, Australia. It would also build a new transmission line that would connect this battery to the existing 330 kV TransGrid substation in Wallerawang. This project would cost $300-400 million.
Neoen says the battery is the key to unlocking future investment in renewable energy and resolving existing grid limitations.
Neoen currently operates the world's largest lithium-ion battery in Hornsdale, South Australia, with a capacity of 150 MW / 194 MWh. The capacity of the new project is three times larger. It could be operational in 2023.
In 2020, Neoen was awarded a contract to build the 300 MW / 450 MWh Victoria battery.
PV Magazine of 12 January 2021
The official announcement on 11 January of a 1 GW solar power plant project in the Gironde region of France, which will involve cutting down 1,000 hectares of forest, is met with opposition from environmental activists.
The promoters (Engie and Neoen within the Horizeo project) affirm that they will replace the 1,000 hectares cut by 2,000 hectares in the New Aquitaine region to remain as close as possible to the local sector.
The project's opponents believe that the announced reforestation would have taken place anyway since it will take place on any area cut down to the ground. For them, the forest will lose 1,000 hectares of woodland.
A public debate will take place in the second half of 2021, between the stakeholders under the aegis of the National Commission for Public Debate.
This investment is estimated at €1 billion, including €650 million for the solar farm, €80 million for the connection, €40 million for the construction of the electrolyser, at 200 million for the data centre, which will be operated by a third party, €20 million for the 40 MWp battery and €10 million for the agrivoltaic site. Around 20% of the park's production will be used for self-consumption for the electrolyser and the data centre, with the remainder being delivered under green energy supply agreements.
PV Magazine of 14 January 2021
NDLR The larger a solar power plant is, the lower the cost price of its electricity. However, very large areas are not numerous in France and are defended by associations that delay or stop projects. For example, the 300 MWp power station in the Causses seems to have been abandoned.
* Why such a wave of increase in panel production capacity?
The automation of panel assembly has greatly reduced investment and operating expenses. This means that if production lines have to be shut down due to overproduction, the financial consequences are small.
A phase of massive capacity expansion will start in 2019. It intensified in the first quarter of 2020, but slowed down throughout the year. From then on, the cumulative figures are in free fall, raising fears of real overcapacity in 2021. Especially if the market forecasts (145 GW to 160 GW, or +20%) turn out to be right.
To adjust the cumulative capacity increases since 2019 to demand, a market of around 300 GW would be needed.
Of this amount, it would be necessary to withdraw the old production capacities, notably those of 2018 which amounted to between 80 GW and 100 GW, in order to leave room for new products such as large wafer formats, the generalisation of monosilicon, and equipment with higher productivity. PV Tech therefore estimates that demand should be in the order of 200 GW in 2021 to limit over-capacity.
As the automation of production lines has developed, the overcapacity in panel assembly production is no longer a question of stopping the machines. On the other hand, the market for silicon, wafers and cells needs to be monitored. The production volume of silicon sets the upper limit of the sector's production capacities. In 2021, the supply of silicon will be limited, which has prompted the major manufacturers to sign supply contracts.
From then on, the overcapacity of the current wave of production capacity expansion is avoidable for the next few years, except for a major collapse in end market demand.
The large manufacturers are gaining market share, which explains their increases in production capacity. These new facilities reduce their cost per watt.
* "Bankability" is associated with market share gains by SSM manufacturers. The world's major suppliers to utilities need to have "bankability" as the key indicator. It is therefore not surprising that the PV ModuleTech bankability pyramid (below) places the majority of MLS members in the top three "A" rankings.
*The second factor in this wave of capacity expansion is the need for other Chinese manufacturers to keep up with the MSSL manufacturers and keep up with the change in technology and cell format.
*The third factor is demand. Many SSML members currently appear to be out of step with market forecasts. Some are very optimistic about demand in 2021 and throughout the decade.
Demand depends on the willingness to decarbonise industry, transport, electric vehicles, but also on green plans to boost the economy. Network parity has now been achieved and can be extended to industry. These factors have been overvalued by certain large manufacturers who have truly ambitious delivery projects. Four members of the SMSL should have delivered more than 15 GW in 2020.
The capacity estimates in this table reflect manufacturers' expectations for growth.
PV Tech of 11 January 2021
Two examples of companies starting plant construction and capacity expansions, provided by PV Tech
The case of the Chinese Eging PVThis company, created in 2003, has operated a small production capacity of cells (1.2 GW) and panels (1.5 GW) during the years 2016-2019. Its turnover, 70% of which is generated in China, has therefore stagnated. A change of management in mid-2019 woke the company up. It launched the construction of a 3 GW ingot and wafer plant in Inner Mongolia for $154 million; it launched a 1.5 GW cell capacity increase for $93 million; it launched a 2.5 GW panel assembly capacity increase for $49 million.
These projects were justified by high electricity costs, obsolete equipment, the need to reduce costs and increase productivity. In addition, the company's cell production capacity was insufficient to meet the needs of panel production.
Eleven months later (at the end of December 2020), Eging PV planned to increase the solar cell capacity by 3 GW at its Changzhou facility, and to add an additional 2 GW of panel assembly capacity to meet demand. In thefirst half of 2020, the company's panel deliveries had doubled compared to the beginning of 2019.
During thefirst quarter of 2020, the industry announced the expansion of 123 GW of ingot and wafer capacity, 212 GW of solar cell capacity and 170 GW of panel assembly capacity.
The case of the Chinese LONGi It is the world's largest producer of monocrystalline wafers. It delivered 20 GW of panels in 2020. Its cumulative plans to increase panel capacity are to reach 50 GW in 2021, with deliveries estimated at around 45 GW.
In January 2018, a 5 MW panel assembly plant is planned in Chuzhou. In April 2019, a 5 MW solar cell factory is announced in Ningxia. At the end of 2020, LONGi announces that the amounts invested in these two facilities were lower than expected and had saved $46 million due to technological progress, lower equipment costs and productivity. LONGi will use this capital to build another 3 GW cell plant.
PV Tech of 14 January 2021
Rather than seeking stability in intermittent solar or wind generation, an international group of scientists in Sweden is advocating exploiting the complementarity of different intermittent renewable energy sources in regional or national electricity grids.
The study presents the multiple barriers as well as important opportunities for the development of hybrid renewable energy systems.
This recommendation comes at a time when solar and wind installations are becoming more and more consistent with ambitious targets for 2030. Energy storage technologies will of course be essential in this respect. The best strategy is based on hybrid systems based on three or four different production sources in order to take advantage of their different intermittency profiles. Each compensates for unavailability, and increases the level of power available to the grid at any given time.
For example, a wind+solar hybrid system can reduce the need for storage by up to 50% compared to either technology operating alone. The addition of two other renewable energies (including hydropower) reduces the need for storage.
PV Magazine of 14 January 2021
* US power purchase contract prices in 2020
Average PPA prices increased by 11% in the US market in 2020 for an average price of $30.56/MWh with extremes between $25.10/MWh (for CAISO) and $37.50/MWh (for PJM) :
This increase began at the beginning of 2020, around the same time as the pandemic began to spread internationally. The virus was not the only factor behind this increase, according to LevelTen. There were delays in connecting to the grid, difficulties in obtaining permits, and supply constraints.
The most competitive projects found buyers, while the most expensive projects remained without buyers. 74% of developers chose not to increase the price of their contracts despite the covid and difficulties. 22% developed fewer projects, which reduced competition. This competition had manifested itself in 2019 leading to a drop in prices. In the end, despite the price increase, there were 50% more offers compared to the previous year:
59% of the developers delayed commercial operation, and 41% delayed the negotiation and execution of energy purchase contracts :
Professionals do not believe that rising prices will cause buyers to lose interest in 2021. Businesses will turn as much as in 2020 or 2019 to renewable energies because managers will want to organise their activity after the pandemic with commitments to price sustainability. This will force buyers to turn to renewable energies.
In addition to businesses, many municipalities, states or government agencies will seek to stimulate their economies in a sustainable way by looking for renewable energies.
PV Magazine of 14 January 2021
15.4 GW of large solar power plants will be commissioned in 2021, according to the US Energy Information Administration (EIA), exceeding the 12 GW of 2020.
Solar energy will account for the largest share of the new capacity (39%); wind energy will contribute 31%. A total of 39.7 GW of new electricity generation capacity is expected to come on stream this year. More than half of the new photovoltaic capacity for power utilities is planned in four states: Texas (28%), Nevada (9%), California (9%) and North Carolina (7%).
In 2021, an additional 4.1 GW of small photovoltaic capacity will be added, which will come on line by the end of the year.
PV Tech of 14 January 2021
* The wind passing under the solar panels placed on the water improves the efficiency.
Researchers from the Netherlands (TNO) and Singapore (SERIS) have found that wind passing under solar panels placed on structures close to water significantly reduces the average temperature of the panels, which increases energy production.
They provided heat loss figures
PV Magazine of 12 January 2021
The Fraunhofer ISE has developed a technique for producing brightly coloured solar panels. They achieve this by means of an optical effect and not with colour pigments, which would reduce their efficiency: 93% of the light can thus enter the panels and produce energy. 7% of the light hits the glass and provides a vivid blue, green or red colouring.
The cover glass forms a photovoltaic panel, or it can be integrated into a solar heat collector. Both technologies could be manufactured in the same production line. In the future, photovoltaic and solar thermal panels could be the same colour and mounted next to each other almost invisibly on roofs or facades.
The cells can overlap by a few millimetres to form a larger panel, creating a homogenous whole without gaps or visible contact wires.
PV Magazine of 14 January 2021
Editor's note This innovation could well make solar panels much more attractive.
The snowfall in Spain raises questions about the effect of snow on the production of solar panels. According to some specialists, some photovoltaic systems may stop working completely and component failures cannot be ruled out, but this depends very much on the orientation angle of the panels and the type of technology used.
A 2013 survey conducted in southwestern Ontario, Canada, indicates that the annual yield of crystalline solar panels is reduced by up to 3.5% per year due to snow, compared to a scenario in the same location without snow. A layer of only 3 or 4 centimetres of snow can cause a conventional panel to stop operating completely. "If there is also a cloudy sky, the performance is practically nil or tends to become insignificant".
Two-sided panels appear to be the optimal choice for areas where there is regular ice, snow or hail. However, the improvement with snow is not very noticeable if the direct exposure area is covered. If the top surface is not cleaned, the performance will still be very poor.
PV Magazine of 13 January 2021
When water freezes, the whole system freezes. The anchors must be installed before the cold weather arrives. Consideration must be given to floating ice, the rise in the water level due to freezing and the large amount and weight of snow that will accumulate. Relatively slow construction and special anchors are required, making the project more expensive.
The low temperature during periods of frost increases the energy production of the floating system.
PV Magazine of 15 January 2021
The American McKinsey says that renewable energies will supplant fossil fuels by 2030, as they become cheaper to install and produce. As a result, solar and wind power plants will account for nearly half of the world's electricity generation capacity by 2035. The document also highlights the competitiveness of green hydrogen by 2030 and its role in the energy transition.
Global demand for coal has already reached its peak, while peaks for oil and gas are expected in 2029 and 2037 respectively.
Finally, in its baseline scenario, the world will be well above 1.5°C of global warming. The pandemic is driving down global energy demand. The economic recovery will lead to a faster demand for electricity and gas than for oil.
PV Magazine of 15 January
Editor's note One must be wary of "studies" that have an ideological presupposition. This seems far too consensual to be credible. If renewable energies are going to develop, their generalisation depends on the use of storage, which is still far from being perfected and above all generalisable.