Hungary's Utility-scale Solar Project Becomes A Commercial Project

Photon Energy Solutions HU Kft., the Hungarian branch of Photon Energy, a Dutch-based solar project developer, has launched a 1.3 MW solar power station in Tolna, central Hungary.

The company said in a statement, “This new power station represents the first Hungarian utility-scale photovoltaic power station in the IPP portfolio of the Photon Energy Group. The company will operate without a support plan. Its annual power generation capacity It is estimated to be approximately 2.1 GWh, which is equivalent to an estimated annual revenue of 420,000 Euros based on the current forward price of Hungary’s power baseload in 2022."

In view of current electricity price trends and the fact that electricity prices in the first half of 2021 will be much lower than in the past few months, Photon Energy said its expected revenue for next year may increase. "Recent market trends and European energy price outlooks prove that our market approach is correct," said Georg Hotar, CEO of Photon Energy. "The economics of our first European commercial power station highlights our presence in Central and Eastern Europe. The value contained in a dynamically growing project development pipeline."

According to FerencKis, a Hungarian renewable energy expert, earlier this summer, Hungary’s grid connection procedures were changed, and the mandatory bid bond had a direct financial impact. "This coordinated distribution of grid connection capacity at the national level will lead to new network connection possibilities previously reserved by developers, but it also provides system operators with an option to choose urgently when the growth rate of photovoltaic capacity exceeds the flexibility of the system. The option of interruption," he told Photovoltaic magazine. "The increase in the upfront cost of the capacity reservation declaration, the reduction in the maximum capacity (20MW) of the large-scale power station on the METAR auction, and the cancellation and re-announcement of the recent renewable energy tenders. These are more projects planned to be carried out on a purely commercial basis. Reasons, such as projects that have recently been completed and settled."

According to Kis, the past three auctions have shown fierce competition, as procurement activities have achieved five times oversubscription, while the average bidding price has fallen by 28% to an average of €50.3/MWh.

The latest statistics from the International Renewable Energy Agency (IRENA) show that by the end of 2020, Hungary has installed 1.95 GW of solar energy, and the newly added capacity reached 553 MW last year.