New Record Set For Large Scale Solar Electricity Cost

Cheap solar electricity

The world’s largest solar park project has also set a record for solar electricity cost that will strike fear into the heart of the fossil fuel based power generation industry.

The Mohammed bin Rashid Al Maktoum Solar Park was originally to boast 1 gigawatt of capacity. That was boosted to 3 gigawatts in January last year and then again in November. The facility is now to be 5 gigawatts capacity by 2030.

In September last year,  the Dubai Electricity and Water Authority (DEWA) released a request for Expressions Of Interest for the 800MW third phase of the park and made it very clear that it was wanting to see prices below USD 0.05 per kilowatt hour.

It wasn’t disappointed.

After whittling down 95 EOI responses from international solar organisations to a handful of qualified bidders, DEWA announced on the weekend that it had received a bid of USD 0.0299 cents per kilowatt hour – a tad under AUD 4 cents. That’s less than average wholesale electricity prices across Australia this year from all sources; including cheap-as-chips filthy brown coal fired power generation.

DEWA also received two other bids below USD 0.04 per kilowatt-hour. It will now review the technical and commercial aspects of the bids and pick a winner.

What makes the 2.99 cent price even more stunning is that it is unsubsidised and confirms that solar power is the cheapest electricity generation option in the Gulf.

” As recently as October 2015, Dubai Electricity and Water Authority (DEWA) awarded the new Hassyan coal power station at a much higher tariff of 5.177 US cents/kWh. Gas-fired power plants in Dubai have an even higher generation cost,” states transaction advisory and strategy consulting firm Apricum.

Dubai has set a renewable energy target of 7% by 2020, 25% by 2030 and 75% by 2050.

The Mohammed bin Rashid Al Maktoum Solar Park is already generating 13MW through its first phase, with the second phase of 100MW capacity currently under construction. When completed, the Park is expected to avoid approximately 6.5 million tonnes of carbon emissions per annum.

DEWA provides 652,200 customers with electricity.