Low investor interest thwarts Greek renewables auctions for Apollo program

Greek authorities were caught off guard by the failure of two auctions for self-consumption renewables projects of the Apollo program.

The Apollo initiative was first announced two years ago. One segment was for supporting vulnerable consumers and the other one was envisaged for municipalities, water utilities and irrigation organizations. Calls for special auctions were launched for wind and solar projects to provide cheap energy in each periphery (region) of the country.

A double auction was recently carried out for vulnerable households. The goal was 400 MW in wind energy and 200 MW in solar, with energy storage. The Ministry of Environment and Energy offered contracts for difference (CfDs) at a maximum EUR 75 per MWh for wind and EUR 80 per MWh for solar.

However, the results were dissapointing. Investors made offers for 380 MW of wind farms and just 61 MW for photovoltaics.

The Regulatory Authority for Energy, Waste and Water (RAAEY or RAEWW) said on Friday that 1,200 MW in wind projects was initially considered available, as well as many gigawatts of solar.

HWEA: The ministry must admit its mistakes

The problem was that since Apollo’s inception, circumstances changed in the local market. Many investments are locked in with power purchase agreements (PPA) or support mechanisms.

At the same time, wind investors are currently in the process of altering their environmental licenses, while also awaiting the new renewables spatial plan. Offered CfD prices did not reflect these uncertainties through any kind of flexibility.

In solar, the requirement for battery storage meant that investors also had to amend licenses, while negotiating new loans with the banks to cover this additional variable.

Little time to repeat the auctions

The result was the failure of the whole process. Authorities now have to repeat the auction under improved terms, although there is a big problem. Support through the European Union’s Recovery and Resilience Facility (RRF) ends within months, so there is little time to re-submit the terms to the European Commission for approval. Otherwise, alternative funding sources will have to fill the gap for Apollo.

The ministry must now admit its mistakes and make improvements, said the General Manager of the Hellenic Wind Energy Association (HWEA or ELETAEN) Panagiotis Papastamatiou.