Higher price caps helped Germany revive investor interest in solar auctions

Germany plans to hold a total of three auctions this year to support the construction of ground-mounted photovoltaic plants, with the first taking place in early March. Although the auction volume more than doubled compared with the previous round, the auction was not plagued by a shortage of projects for the first time in more than a year. A key factor was apparently the 25% increase in maximum bid prices, which Germany introduced not only for solar auctions to revive bidding and ensure a sufficient supply of projects.

After a shortage of projects had plagued Germany’s last several auctions to support the construction of photovoltaic plants, the situation changed for the first time in more than a year. The first standalone auction for photovoltaic plants this year took place in Germany in March, with investor interest clearly exceeding the capacity on offer. To revive investor interest, German network regulator Bundesnetzagentur and lawmakers there took the drastic step of raising maximum permissible prices by 25% year on year in almost all auctions supporting renewable energy sources.