Europe is building more wind and solar without any subsidies

Europe is building more wind and solar without any subsidies

The French electric utility Engie announced that it’s going to develop 300 megawatts of wind energy across nine wind farms in Spain, backed by $350 million (€300 million) in investment.

Here’s the key: It’s doing all this without government support. And it’s far from the only European energy company willing to make a bet like this.

In March, the Swedish power company Vattenfall announced it won its bid to build a 700 MW offshore wind farm in the Netherlands, which would make it the first nonsubsidized wind energy project in the land of windmills.

Over in Germany, in the country’s first competitive power auction last spring, the federal grid regulator accepted four bids for a total of 1,490 MW of offshore wind capacity in the North Sea, with an average subsidy rate of €0.44 per kilowatt-hour. That’s low. And why so low? Because one of the bidders, the Danish wind energy firm Dong (now Ørsted A/S), submitted a bid with a subsidy rate of zero.

It’s happening with solar too. There are now at least a dozen unsubsidized solar projects that have broken ground in Europe, as this chart shows:

 

All of this is evidence that major renewable energy projects can take off without a financial boost from governments. It’s great timing because the European Union is looking to phase out subsidies for renewable energy as these policies have become expensive with an explosion of wind and solar installations across the continent.

It’s also a sign that these technologies have drastically dropped in cost and are increasingly safe investments for the notoriously stodgy utility sector. As such, we’re going to see more subsidy-free solar arrays and wind farms cropping up in Europe, driving a larger share of the growth.

Source: Vox

Date: July 2018

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