Ahead of Solar Media’s Large Scale Solar Central Eastern Europe event in Poland from 26-27 November, PV Tech spoke to Rezolv Energy CEO Alastair Hammond about the company’s work in the region, and how the maturation of the power purchase agreement (PPA) market in central and eastern Europe could help encourage yet more investment into the area.
PV Tech: What is the role of solar power in the future of Eastern Europe’s energy mix?
Alastair Hammond: Solar power is an important component of every national energy strategy that has been published across this region. It’s partly about geography. Rezolv Energy is focused on south-eastern Europe, and it’s a region which enjoys some of the best natural conditions for solar in Europe.
Countries like Greece, Bulgaria and Romania receive between 1,900 and 2,400 hours of sunlight per year on average. It’s therefore right that solar should be at the heart of the energy transition, although wind has a hugely important role to play too.
How will storage, both standalone and co-located, fit into this transition?
These days, every large solar project must consider some form of energy storage. Peak output is a challenge, so there is a need to store excess energy, but that can be a challenge for very large projects. With a 200MW plant, if you have a 200MW battery, it will only offset the peak generation for one hour.
Ideally, you want the battery to hold two to four hours of capacity. However, we are looking at battery energy storage systems (BESS) at both of our major solar projects in Romania and Bulgaria, which are 1,044MW and 225MW respectively.
You have worked extensively in Romania in particular; how would you describe the Romanian solar market at present?
“These days, every large solar project must consider some form of energy storage,” said Alastair Hammond. Image: Rezolv Energy.
The Romanian solar market is accelerating fast—faster than it might appear because there are a number of large-scale projects being built which have not yet come onstream. Rezolv’s 1,044MW Dama Solar project in western Romania is an example. That will be the largest solar project anywhere in Europe once it is operational.
In terms of regulation, the most impactful thing the Romanian government could do is to start the process of applying to join the Association of Issuing Bodies (AIB)—thereby enabling Guarantees of Origin (GOs) to be transferred between EU member states. GOs are a critical component of corporate PPAs, and PPAs are a crucial part of the energy transition. We are very hopeful that Romania will take the decision to join the AIB very soon after the election that is coming up at the beginning of December.
How does solar compare to wind in Romania?
Rezolv has so far broken ground on two projects—the 461MW VIFOR wind farm in Buzău County, Romania, and the 225MW St. George solar park in north-eastern Bulgaria. The first phase construction of the VIFOR project is being supported by finance loan facilities of up to €291 million from eight lenders including the Erste Group, UniCredit Group, the European Bank for Reconstruction and Development (EBRD) and the International Finance Corporation (IFC). For St. George, we have secured up to €90 million in debt financing from the IFC and Raiffeisen Bank International.
I am therefore talking about Bulgaria as well as Romania, but, based on our experience, there are no major differences between wind and solar when it comes to permitting or financing. In both cases, the sustainability profile of the project is hugely important. It’s a key concern for lenders, as it is for PPA customers. In the last five months alone, Rezolv has signed six PPAs covering a total of 460GWh per year with companies including T-Mobile Czech Republic, Slovak Telekom, the Ardagh Group and Bekaert—and sustainability has been an important consideration for all of those companies.
Looking ahead, do you expect solar to account for a larger proportion of Romania’s energy mix?
Solar still makes up a relatively small part of Romania’s electricity generation mix – 3.7% last year, compared to over 13% for wind – but the solar share was up from 2.9% in 2021, so things are moving in the right direction. Things will accelerate much more quickly once large-scale projects like Rezolv’s start to come onstream.
Romania is certainly an attractive investment destination. The fact that three out of four of Rezolv’s projects in south-eastern Europe are in Romania is evidence of that. However, there is still a lot more to be done to realise Romania’s renewable energy potential because it enjoys some of the best natural conditions anywhere in Europe. It is blessed with plenty of sunshine and has several prime locations for wind power development as well.
I would like to emphasise that the PPA market is now very much up and running in south-eastern Europe. I mentioned that, since June, Rezolv has signed six virtual PPAs (VPPAs) covering 460GWh per year.
They are an important signal to the business community that serious renewable energy capacity is coming onstream in this region. That clean power is, of course, available to companies in the region but it is also, through the VPPA model, available to companies whose energy consumption is concentrated in other European countries.
That’s a real game-changer because it means that corporate buyers do not need to wait for renewable energy capacity to start coming onstream in volume in their home market. The widespread – and growing – corporate demand for green electricity can be met right now, and the path is open for South Eastern Europe to become Europe’s next big hotspot for renewable energy PPAs.
PV Tech publisher Solar Media will be organising the fourth edition of Large Scale Solar Central and Eastern Europe in Warsaw, Poland 26-27 November 2024. The event will focus on Eastern Europe with a packed programme of panels from industry leaders, including Jaroslava Korpanec, head of central and eastern Europe at Actis, the investor behind Rezolv, responsible for the build out of solar and storage projects in Poland, Bulgaria, Romania, Hungary and the Baltics. For more information visit the event website.
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Publish date : 2024-11-20 16:00:00
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The post Maturing PPA market is a ‘real game-changer’ for Romanian solar first appeared on Love Europe.
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Publish date : 2024-11-22 01:31:27
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