Small is beautiful as solar farms look for ways around grid chaos

RenewEconomy

And in South Australia, Tag Pacific subsidiary MPower has started preliminary works on two new 5MW solar farms in South Australia, having successfully commissioned another two at Mannum and Port Pirie, also in South Australia in 2019.

Meanwhile, renewable energy retailers are also leaning towards smaller projects as sources to supply their power purchase agreements.

Renewable energy retailer and PPA specialist Flow Power, for example, recently sealed a deal with the City of Adelaide to supply all of the local government’s operational energy needs from a mix of wind and solar – the latter from two new solar farms on South Australia’s Eyre Peninsula and in the south-east.

These projects – the 3MW Streaky Bay and 5MW Coonalpyn solar farms – were acquired by Flow from Tetris Energy, which has been active in the South Australia market, in both developing projects and securing PPAs.

In an interview with RenewEconomy on Friday, Flow Power’s senior investment officer Stephen Au said the PPA with the City of Adelaide had provided “a very strong anchor” for the company to secure financial close and EPC contractors for the two solar farms.

A shortage of EPC contractors has been another worrying side effect of the current market woes, with the collapse of RCR Tomlinson last year, and the shock announcement this week that another major industry player, Downer Group, was exiting the Australian solar market due to the unacceptably high degree of risk.

“We are seeing a little bit of a slowdown in projects getting to financial close,” Au told RenewEconomy on Friday. “Developing and contracting 5MW projects is one way for us to continue to deliver assets to customers.

“Having said that, we are still continuing with our plans … to develop and make offtake deals with larger projects, but we are being more careful with the selection of projects, using our engineering expertise.”

Flow has been extremely busy over the past 36 months working between corporate clients and renewable energy project developers to supply more Australian businesses with cheap and clean power.

Some of the major solar projects the company has secured off-take deals with include some of the larger Victorian generators whose output has been heavily curtailed by the Australian Energy Market Operator to address problems of “system strength” on certain parts of the grid.

Total Eren’s 200MW Kiamal solar farm, for instance – with has major off-take contracts with Flow, as well with Snowy Hydro – was compelled to install a synchronous condenser at the project, in order to get around local grid congestion problems.

“We’re not immune,” Au said. “We’re learning as well. We’ve had some very good experiences and some not-so good.

“The most important thing is to recognise that there is a problem in the first place, and … try and find solutions to help our customers get around any problems.”

And relative newcomer to the Australian market, the Lithuania-based WePower, is taking a similar approach. The company has recently completed its first Australian PPA, with a 10-year, $10 million deal with People Energy and QEnergy to buy all of the output from a 9.4MW solar PV plant in Robinvale, Victoria.

The Suntech-built Robinvale Solar Farm was last year contracted to Mojo Power, as one of the plants the company intends to source for wholesale power.

At the time of that deal, Mojo CEO Warren Murphy said smaller sized solar farms were better suited to the company’s load – with upwards of 60,000 customers, many of them generating their own rooftop solar.

Nick Martynuik, the co-founder and CEO of WePower, says his company has a similar strategy in mind for Australia.

“Some developers started going for smaller projects, like a long time ago, to be less influenced by curtailment,” he said.

“We want to establish a base layer of virtual PPAs, and then it’s the customer’s choice. If you want firming, we can provide it. We have multiple partners.

“Australia is one of the best countries for PPAs [thanks to] amazing resources, a lot of sun a lot of wind, and the market itself, the structure of the market, allows corporate PPAs to be done very easily,” Martynuik added.

“Some large companies already [secured] their PPAs. We’re opening up the market for smaller companies to buy directly from the supplier they want to,” he said.

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