Auctions for solar-plus-storage: prices stagnate after two-year decline

Germany plans two separate rounds of innovative auctions this year, in which developers of renewable energy projects with storage compete for support. Photovoltaic plants combined with battery storage have dominated these auctions from the outset. The first round this year took place in early May, attracting considerable interest. Despite an oversubscription of submitted projects, the awarded prices were essentially unchanged from the previous round.

Germany continues to hold auctions for renewable energy developers, who can use them to secure predictable revenues for their projects. In addition to the traditional auctions for solar and wind farms in the country, two rounds of so-called innovative auctions are held each year.

Only projects combining different renewable energy technologies or incorporating short-term storage can compete in these auctions. For projects equipped with storage, these components must account for at least 25% of the system's total installed capacity and be capable of fully discharging within two hours.

The first round this year took place in early May and brought no major surprises. As in previous rounds, all the awarded capacity went to projects combining photovoltaics with battery storage. According to the German network regulator, developers submitted projects with a total capacity of 749 MW, while the auction volume was 475 MW.

Developers secured minimum prices ranging from 47.5 to 56.1 EUR/MWh, with a weighted average of 53.4 EUR/MWh. Compared with the average of 53.1 EUR/MWh in the previous round, this represents no significant change; in fact, prices edged up slightly. Over the past two years, however, auction prices fell by approximately 15% from one round to the next.