Significant step forward for large-solar sector

The Clean Energy Finance Corporation (CEFC) has congratulated the Australian Renewable Energy Agency (ARENA) on the conclusion of its large-scale solar funding round, which will support the development of an additional 480 MW of large-scale solar in Australia.

ARENA announced that 12 projects had successfully bid for a total of $92 million in funding support through its large-scale solar program. While large-scale solar grant applicants had typically sought grants for up to 50% of project costs some four years ago, ARENA grant requirements in this funding round have fallen to around 10% of the project value, highlighting the increasing cost competitiveness and economic viability of large-scale solar PV technologies.

CEFC CEO Oliver Yates said this outcome was a significant milestone in Australia’s growing large-scale solar industry, with the results of the ARENA funding round providing a clear demonstration of the increasing cost competitiveness of the sector.

“We are seeing positive signs of large-scale solar gaining cost parity and even trending below the costs of other forms of new-build energy generation, with some proposals having a projected levelised cost of energy below $100 per megawatt hour,” Yates said.

“With trend figures from Bloomberg New Energy Finance suggesting the cost of new-build black coal generation is sitting at around $130 per megawatt hour, we can have confidence that solar generation costs will continue to fall, making large-scale solar an increasingly important contributor to Australia’s future energy mix,” he said.

Yates confirmed the CEFC was working on the provision of debt finance to the successful ARENA grant recipients, as well as project proponents who had either not achieved an ARENA grant or not applied for one.

“With projects in ARENA’s funding round requiring grants of an average of around 10%, it is clear that solar is making rapid progress as a maturing technology and becoming competitive with other forms of energy generation.

“We see strong potential for future funding gaps to be met through tailored financing mechanisms such as those developed by the CEFC. We are looking forward to working with project proponents and other lenders to provide cost-competitive finance to accelerate the construction of large-scale solar in Australia.

“The CEFC’s role is essential to maintaining the momentum of solar within the mix of Australia’s transitioning energy sector and, in turn, to the achievement of the Renewable Energy Target,” he said.