European PPA deals rise to yearly high

Spanish Market: Electricity
20/11/23

The number of power purchase agreements (PPAs) announced so far this year in Europe rose to a monthly high in October, with most deals taking place in Germany, Poland, Belgium and Italy.

A total of 35 major PPA transactions were announced last month, which made up around 3.6 TWh/yr of renewable power supply reported in agreements, according to data compiled by Argus — (see European Power Purchase Agreements). This is up from 28 PPAs announced in September, when the total power supply reported reached about 2.24 TWh/yr, and also above just 12 PPAs reported in October 2022 (see chart).

The number of PPAs announced over January-October this year has totalled 241, up from 141 in the first 10 months of last year and around 40pc higher than the number of deals over the entirety of 2022.

Deals in Germany, Belgium and Italy constituted the majority of PPAs in October, with each of these countries entering into five deals, resulting in a combined supply volume of 2.26 TWh/yr. Poland registered a total of four PPAs during the month, with reported volumes of around 165 GWh/yr. France and Spain each recorded three PPAs, while Bulgaria and Serbia each entered one. This is the first time a deal was announced in Bulgaria since June, while Serbia had last seen a deal in February.

Germany, Spain and Sweden accounted for most deals in October last year, with a combined nine PPAs, of which four were in Spain, three in Germany and two in Sweden. France, Italy and Poland registered only one PPA in their respective markets at that time.

The 325MW C-power and 180MW Butendiek offshore wind farms in Belgium and Germany, respectively, were the largest wind power plants contracted in October this year. And the 138MW Meath and Wexford solar photovoltaic (PV) plants in Ireland were the biggest PV projects entering into agreements.

The average supply duration of the PPAs last month stood at 11.58 years, slightly up from 11.14 years in September and 10.11 years in October 2022. Most of the power contracted was done through solar power plants at around 51pc, with onshore and offshore wind as well as hydro accounting for the remaining share.

European PPA prices rebounded in the third quarter of this year owing to rising demand and power prices, according to a report by firm LevelTen Energy in October. Solar PPA prices in Europe rose by 2pc on the quarter to reach an average of €74.06/MWh in July-September, up from €72.02/MWh in the second quarter. Wind PPA prices also rose, by 2pc, to €99.82/MWh from €98.17/MWh.

PPA prices could increase in the fourth quarter as demand continues to rise, although so far this year price changes have been more moderate than in the past several years, LevelTen Energy told Argus at the time.

By Makani Joinville

Number of PPAs announced

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09/05/25

Australian firms flag coal phase-out timeline concerns

Sydney, 9 May (Argus) — Energy utilities raised concerns that Australia's coal-fired power generation phase-out might be running on an unrealistic timeline, according to submissions to the National Electricity Market (NEM) review consultation process. Utilities AGL Energy, Alinta Energy, Delta Energy, Energy Australia, Origin Energy and Stanwell — which operate 10 of the 20 coal-fired power plants in Australia (see table) — submitted separate recommendations to the consultation launched late last year looking at wholesale market settings. This came after the conclusion of the Capacity Investment Scheme (CIS) tenders in 2027, and as Australia transitions to more renewables from its aging coal-fired plants. The Australian Energy Market Operator (Aemo) forecast the country will exit all coal-fired generation by 2038 in its Integrated System Plan (ISP) published in 2024. But Delta Energy predicts that this timeline will not be met, and views ISP's priority as emissions reduction targets rather than a realistic timeline. Insufficient capacity to replace the coal plants was a common issue flagged by these companies, with AGL saying this is partly because of uncertainty in the market leading to less investments. The utility plans to close all its coal plants by the end of June 2035. AGL was Australia's largest emitter of greenhouse gas emissions in the 2024 financial year, according to the Clean Energy Regulator (CER), followed by Stanwell, Energy Australia and Origin Energy. The transition could be supported using flexible dispatchable resources, according to Origin Energy. The coal phase-out means more variable renewable energy (VRE) is required, but VRE output will not necessarily match demand. "The NEM review must also consider the actions to facilitate the planned retirement of coal-fired power stations from the energy system, which will still be occurring in the NEM beyond the CIS," Stanwell warned. "The urgency of developing solutions cannot be overstated, as any indecision now would result in increased government intervention later, and a disorderly and costly NEM beyond the CIS." Gas-fired generation A few firms view gas-powered generation as critical in the transition away from thermal coal and in maintaining system reliability. It will provide back-up in times of renewable droughts, said Stanwell and AGL, and should be noted in discussions of the forward strategy. But Alinta Energy is cautious of the costs of gas-fired power plants, believing them to be the least costly for customers but not economically viable because of their exposure to global gas market prices. Alinta's suggestion is to reduce the market's dependence on high-cost facilities including gas-fired facilities. Mixed views on capacity market Some companies mentioned a capacity mechanism as a solution. Coal-fired facilities should be allowed to continue until they can be replaced, said Alinta Energy, and gas power plants are necessary. Energy Australia and Delta are calling for the NEM to stay technologically neutral in this process, keeping thermal coal exits in mind. A capacity market needs to be sustainable without government subsidies, Alinta Energy said, and exit strategies for government intervention should be clear from the beginning. But capacity markets can lead to higher costs for customers, according to AGL, because of potential over-procured capacity. "If a capacity mechanism was implemented, it would be important to consider the impact of any capacity incentive on the operation of the NEM and the appropriate level of the market price settings — a balance that may be difficult to strike," AGL noted. The expert independent panel leading the review will continue carrying out consultation, and is expected to make final recommendations to energy and climate ministers in late 2025. By Susannah Cornford Australia coal fired power plant closures in NEM Plant Capacity (MW) Owner Closure date State Emissions CER 2023/24 year Scope 1 & 2 of CO2e Eraring 2,880.0 Origin 2025 NSW 13,550,220.0 Yallourn 1,480.0 Energy australia 2029 Vic 10,502,080.0 Callide B 700.0 CS Energy 2029 Qld 4,028,161.0 Total by 2030 5,060.0 28,080,461.0 Coal plant closures in NEM after 2030 Bayswater 2,640.0 AGL 2030-33 NSW 13,712,719.0 Vales Point 1,320.0 Delta 2033 NSW 7,111,963.0 Stanwell 1,460.0 stanwell 2035 Qld 6,982,204.0 Tarong 1,843.0 Stanwell 2035 Qld 10,936,021.0 Kogan 740.0 CS Energy 2035 Qld 4,522,472.0 Callide C 825.0 CS Energy 2035 Qld 688,038.0 Loy Yang A 2,210.0 AGL 2035 Vic 18,723,707.0 Sub-total 11,038.0 62,677,124.0 Total by 2030 16,098.0 90,757,585.0 CER Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Mitsubishi joins Philippine coal plant phaseout project

09/05/25

Mitsubishi joins Philippine coal plant phaseout project

Osaka, 9 May (Argus) — Japanese trading house Mitsubishi has agreed to join a project to phase out a coal-fired power plant in the Philippines, aiming to generate carbon credits through the Transition Credits mechanism along with Japan's Joint Crediting Mechanism (JCM). Mitsubishi and and its Hong Kong-based subsidiary Diamond Generating Asia (DGA) has agreed to join Philippine energy firm Acen, GenZero — a subsidy of Singapore state-owned investment firm Temasek — and Singapore conglomerate Keppel to phase out the 246MW South Luzon coal-fired plant in Batangas, the Philippines, and replace it with a clean power facility. The initial deal for this project was signed by Acen, GenZero and Keppel in August 2024. Acen is now seeking to decommission the coal-fired plant by 2030, instead of the previous target of 2040. It is still unclear what types of clean power sources will then be deployed. But renewables such as solar or onshore wind, alongside storage batteries, could be possible, a Mitsubishi spokesperson told Argus . The partners aim to leverage Transition Credits (TCs) for the early retirement of the plant. TCs are high-integrity carbon credits generated from the emissions reduced through retiring a coal-fired plant early and replacing this with clean energy. The South Luzon project is expected to be one of the first converted coal-fired plants in the world to generate TCs. The project is expected to generate carbon credits equivalent to 19mn t of CO2 emissions reduction over 10 years, the Mitsubishi spokesperson told Argus . Mitsubishi plans to include this project in the JCM mechanism, as the Philippines has been Japan's JCM partner country since January 2017. The company is already marketing the carbon credits in Japan, assuming the credits will be verified under the JCM, while also hoping to sell them in Singapore and the Philippines. Verified carbon reductions or removals under the JCM can be quantified on an international basis. Some of the JCM credits issued from such mitigation efforts will be used to achieve Japan's nationally determined contributions (NDCs), while ensuring double counting is avoided on the basis of corresponding adjustments between countries and consistency with the guidance on co-operative approaches referred to in Article 6.2 of the 2015 Paris climate agreement. JCM credits could be also traded under the Japan's green transformation emission trading system (GX-ETS), which will be officially launched in autumn of 2027 . The GX-ETS adopts the cap-and-trade programme, with the government allocating free allowances for each eligible entity every year. Japan is still highly dependent on coal-fired generation, although Tokyo has pledged to phase out inefficient coal-fed plants by 2030. Coal-fired output accounted for 32pc of the country's total power generation in 2024, according to data from the trade and industry ministry. When asked by Argus where there is the potential for the introduction of the Transition Credits mechanism in Japan, the spokesperson said Mitsubishi has not ruled out the possibility, but added there have been no discussions on this for now. By Motoko Hasegawa Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Japan’s Erex to build biomass power plant in Cambodia

08/05/25

Japan’s Erex to build biomass power plant in Cambodia

Tokyo, 8 May (Argus) — Japanese renewable energy developer Erex aims to start constructing a 50MW biomass-fired power plant in Cambodia in mid-2025, the company told Argus today. The plant in southern Cambodia's Kampong Speu province will be the first biomass-fired power project for Erex in the country. It is scheduled to start commercial operations in the 2027-28 fiscal year, and will burn domestic wood chips and agricultural residues to generate around 350 GWh/yr. The Cambodian government will purchase all the electricity generated at the plant for 25 years after its start-up. Erex plans to build up to five biomass-fired power plants which will burn domestic biomass fuels, as well as several wood pellet factories in Cambodia. The government expects these projects to raise the country's energy security. Erex on 23 April began commercial operations at the 20MW Hau Giang biomass-fired power plant in southern Vietnam, its first biomass-fired power project in the country. Erex aims to construct up to 18 biomass-fired power plants in Vietnam, following Hau Giang. The company has already started constructing two 50MW plants in northern Vietnam. Erex also started wood pellet production at its first factory in Vietnam in March, with a capacity of 150,000 t/yr. The company plans to build up to 20 wood pellet factories in the country. Erex's profits from projects in Vietnam and Cambodia are expected to grow rapidly and could account for more than half of its total profits by around 2030, according to the company, and the projects would also contribute to both countries' decarbonisation efforts. By Takeshi Maeda Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Australian renewable projects gain power grid access

08/05/25

Australian renewable projects gain power grid access

Sydney, 8 May (Argus) — A total of 10 renewable energy projects have been granted access to a power grid in New South Wales (NSW), Australia, to avoid over 10mn t/yr of CO2 equivalent (CO2e) of emissions by 2031, the NSW state government said today. The 10 private solar, wind and battery storage projects will connect to the Central-West Orana Renewable Energy Zone (REZ) , a 20,000 km² area about 400 km west of state capital Sydney that will avoid 10.29mn t/yr of carbon emissions, according to the state's energy minister. Construction of the 240 km transmission line connecting the renewable energy projects to the national electricity market will start in mid-2025 and is estimated to cost A$3.2bn ($2.1bn). The 10 projects will provide total renewable energy and storage capacity of 7.15 GW, capable of powering over half the households in NSW by 2031. The Central-West Orana REZ is expected to be completed by December 2028 and is part of the NSW's transition to renewable energy. The REZ is expected to generate 15,000 GWh/yr of energy when fully operational, around 5pc of the total 273,000 GWh generated in the country in 2023, according to the Australian Department of Environment. The REZ improves the state's chances of meeting its target of reducing emissions by 50pc from 2005 levels by 2030 through lowering its reliance on coal-fired generation, which accounted for 70pc of fuel used in NSW in May 2024-April 2025. Australia's largest coal-fired power station Origin's 2,880 MW Eraring provides 18pc of the state's electricity and will close in August 2027, around a year before the expected completion of the Central West Orana REZ project. By Grace Dudley Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

UK, Norway pursue further ‘green industry’ co-operation

07/05/25

UK, Norway pursue further ‘green industry’ co-operation

London, 7 May (Argus) — The UK and Norway have signed an early-stage agreement for a "green industrial partnership", planning to work together on low-emissions technology such as offshore wind, carbon capture and storage (CCS) and hydrogen. The partnership will "strengthen energy security" and "support robust value chains for raw materials", the Norwegian government said. The collaboration also aims to "support the development of renewable energy sources, and further develop existing cooperation on the protection of subsea infrastructure in the North Sea", Norway's government added. Both Norwegian and UK representatives are in attendance at the Copenhagen climate ministerial this week — an event which often sets the direction for climate negotiations this year. The countries in December flagged their intent to partner on the energy transition, including developing an agreement on cross-border CO2 transport. Norway is a leader in Europe's developing CCS sector. The country's flagship Northern Lights CCS project is due to begin operating this summer. The project's partnership this week confirmed that all required permits are in place for the injection and storage of CO2. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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