Huge Subsidy-Free Partnership On 500 MW+ Expansion Of Solar PV In Denmark
I have been watching Danish solar photovoltaic capacity and output closely since 2015, because I had a feeling something was looming after seeing the explosion of installed capacity in Germany in years prior.
When realtime solar PV output became available on energinet.dk, it was clear to see that this section of energy generation was growing. But was it growing exponentially? The famous “doubling every two years” statement from Ray Kurzweil in 2016 seemed far fetched, but as I have speculated in earlier posts, solar will dominate in the not so far future. In 2015, Denmark had a nameplate solar PV capacity of around 300 MW, and today we are closing in on 900 MW.
Energinet.dk just announced that 2019 had the lowest ever carbon-emission rate of generation of energy in the country: 135 grams of CO2 per kilowatt-hour generated. Area manager in Energinet Electrical System Responsibility, Hanne Storm Edlefsen, states:
“If you look at it historically, it is a really, really low number, and it shows the impressive green journey that the Danish electricity system has been on. In 1990, a kilowatt-hour produced emitted over 1000 grams of CO2 — about seven times as much.”
Still, another giant leap is about to be realized in this section, and below are extracts from a press release from ENCAVIS AG that sets the renewable future of the Danish energy generation system in stone. Encavis AG is a producer of electricity from renewable energy sources. It acquires and operates solar and wind parks and is one of the leading independent power producers in Europe.
Before we get into that, a quick note that the Danish Climate Council has just announced, that it advises the government to end all future oil and gas exploration in the North Sea. Chairman of the Climate Council, Peter Møllgaard, states:
“The exploration for new oil and gas fields in the North Sea could damage Denmark’s climate credibility on the international scene. By continuing the exploration rounds in the North Sea, we risk diluting the status of a pioneer country that Denmark achieves through ambitious reductions in greenhouse gas emissions within Denmark’s borders.”
So, just to be clear: oil is on its way out, renewables is coming in a big way. Without further ado, here’s the press release from Encavis AG:
ENCAVIS AG partners with GreenGo on 500 MW+ solar portfolio in Denmark
Hamburg, May 26, 2020 — Encavis AG (Prime Standard, ISIN: DE0006095003) is pleased to announce that it has signed a partnership agreement with GreenGo Energy Group a/s concerning a 500 MW+ portfolio of utility scale subsidy-free solar projects in Denmark.
The parties have co-created an innovative full cycle partnership model where Encavis will acquire projects early on and ensure financing through to COD, and where the parties are aligned on fully optimizing the project portfolio throughout the development and construction execution cycle.
Under the agreement, Encavis has secured exclusivity for a 500MW+ portfolio, structured to ensure sufficient risk mitigation through diversification across Denmark. The lead project, Project M01A, which has already obtained zoning approval and building permit in Ringkøbing Skjern kommune, is planned to commence construction this year in due course.
Dr Dierk Paskert, CEO of Encavis AG, comments on the perspectives:
“We are excited about this new partnership with GreenGo on the Mermaid portfolio of Danish solar projects. It’s in synergy with our >> Fast Forward 2025 Strategy. We know Denmark very well already from our growing wind portfolio, so adding solar to the mix at this scale makes perfect sense. We look forward to further adding to the energy transition in Denmark.”
Karsten Nielsen, CEO of GreenGo, comments:
“We are proud of this new partnership with Encavis, a leading European IPP with an excellent track record. The agreement will ensure full cycle financing of more than 500MW of our rapidly growing Mermaid solar portfolio in Denmark.”
Karsten Nielsen, continues:
“Denmark is probably one of the most interesting solar markets these days. The ambitious 70% 2030 [emission reduction] goal will help accelerate the energy transition and it will create a massive demand for electricity. The Climate Partnership Of Denmark expects demand to growth to 71TWh by 2030, 2x compared to 2020, this coming primary from data centres, e-mobility, heat-pumps and Power2X. This is certainly a historic and game changing moment for Denmark, and probably the largest expected electricity demand growth rate per capita in the world. GreenGo is very well positioned to lead in this solar revolution in Denmark, and this without any request for subsidies. This based on its significant pipeline across Denmark with more than 70 solar projects totalling 2,000MW+ and growing, and its demonstrated ability to attract capital from tier1 institutional and renewable investors. A great example is this 500MW+ financing partnership agreement with Encavis AG. Going forward, the time is now to demonstrate that solar plus storage can be the new pillar of renewable energy generation in Denmark. Solar is disrupting on-shore wind and in particular off-shore wind in terms of pure LCOE. We believe, that everybody will realize this soon.”
GreenGo was founded in 2011 with the vision to accelerate conversion to renewable energy generation, by an innovative and scalable business model. GreenGo’s 360 full services platform includes development, offtake, engineering, construction management, operations & maintenance and asset management services fully tailored and bespoke to its client’s needs and investment profile. GreenGo has digitized and structured the execution process through IT systems, enabling efficiency and quality in all execution phases. GreenGo provides increased returns, convenience, influence and differentiation to their clients.
GreenGo now has 3,000MW+ of solar and storage project assets in various stages of development in selected U.S. states and Scandinavia, of this approximately 140MW in construction. Over the past 12 months, GreenGo has secured more than EUR 700 million (DKK 5.2 billion) in full cycle financing for its project pipeline, and the investor/client base continues to grow.
Well, I guess solar might come to dominate after all, and if this happens in a northern country like Denmark, it could happen anywhere, right? Apart from maybe beyond the polar circles. …
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