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Floating Solar PV Gains Global Momentum
2020-09-23
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This article explores the current state of floating solar PV (FPV), briefly highlighting several leading markets, and discussing benefits and advantages in detail alongside common applications and business model considerations. The outlook for FPV is positive and is set to break free of its niche perception. It could well become the third pillar of the solar PV sector in future.


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Alongside ground-mounted and rooftop PV, floating solar PV (FPV) is often hailed as the future third pillar of the global solar PV market. At present, among the 60+ countries actively pursuing the deployment of FPV (see Map 1 below), more than 35 countries are home to an estimated 350 operational FPV systems, which up until the end of August 2020 had a cumulative capacity of approximately 2.6 GW. Although still considered a niche, FPV is projected to experience an average growth rate of above 20% in the coming five years.


In this context, Asia is expected to account for roughly two thirds of the global demand, mostly driven by China, India, South Korea, Taiwan, Thailand and Vietnam.


China: To date, China is the world’s largest market for FPV. Currently, FPV systems are either deployed as a result of a bidding scheme, thus eligible for a FIT granted over 20 years or as a so-called grid-parity project, i.e., without any form of subsidy support. To illustrate the on-going demand for FPV, in June this year, China’s Datang Power released a tender seeking several bids for a total capacity of 820 MW of FPV to be installed across China by December 2021.


India: India’s domestic solar PV market, considered to be one of the most competitive in the world, witnessed a 45% drop in bid prices for FPV tenders from 2016–2018. For example, the lowest bid quoted by developers for a 70 MW FPV system earlier this year was as low as INR 35/W (EUR cents 4/W). The are several reasons for such a fairly low bid, e.g., improvement of manufacturing processes, reduction of material costs, reduction in thickness of floaters and aggressive bidding by developers in order to gain FPV related experience. The latter might be the main reason, given that between 2018 and the end of 2019, the government of India released a series of tenders for FPV systems amounting to approximately 2 GW. Presently, around 1.7 GW are in various stages of development.


South Korea: Located on South Korea’s southwest coast, the tidal flats of Saemangeum have been identified as the site for the world’s largest FPV installation of 2.1 GW by 2025, requiring an investment of approximately US$4 billion. South Korea’s third largest conglomerate, SK Group, has been selected as a preferred bidder to build 200 MW as part of Phase 1 with 1.2 GW, scheduled to begin in the latter half of 2020. These nearshore/maritime and coastal or offshore floating PV undertakings are in addition to South Korea’s estimated onshore FPV market potential of around 9.7 GW, which depending on the body of water (reservoirs, freshwater lakes, dams, irrigation & drain channels), would see between 2–20% of the water surface covered by FPV.


Taiwan: The Taiwanese government has offered FITs specifically for FPV systems since 2017. Accordingly, FPV systems coming online in the second half of 2020 are eligible to receive a FIT of NTD 4.2709–4.7067/kWh (EUR cents 12–14/kWh) for 20 years. Local developer Chenya Energy, owned by Marubeni, is constructing what will be the world’s largest FPV with a capacity of 180 MW scheduled to be grid-connected by the end of 2020 (and as mentioned above, the title of the “world’s largest FPV” will then go to the planned South Korean installation of 2.1 GW in 2025).


Thailand: A national FPV target is favoured for example, by the Electricity Generation Authority of Thailand (EGAT), which announced in March 2019 that it aims to build a total of 16 FPV systems on dams with a combined capacity of 2.7 GW by 2037. Individual capacities of the envisaged FPV systems range from 24 MW up to 325 MW. In June 2019, EGAT released a tender for a 58.5 MW FPV project, which will be financed by its own fund to the tune of around EUR 51M. According to the World Bank, the CAPEX of this 58.5 MW FPV project amounts to USD 0.48/Wp (EUR cents 0.41/Wp). In November 2019, the Bangkok-based BCPG company commissioned a 200 kW FPV on a private Power Purchasing Agreement (PPA) basis signed with the local Bangchak Biofuel Company.


Vietnam: In order to de-risk investments in FPV, the Asian Development Bank in cooperation with the Canadian Climate Fund, provided a $37 million concessional loan in autumn last year for a 47.5 MW FPV to be built in southern Vietnam. The project is planned to be built on a man-made reservoir co-located with an existing 175 MW hydro-power plant. In April, the government of Vietnam announced its plan to hold two auctions, one aiming at a 50–100 MW capacity planned for 2020 and the second for a 300 MW FPV project in 2021. On May 22, the government announced a FIT for FPVs. Accordingly, a tariff of VND 1,783/kWh, equivalent to EUR cents 0,65/kWh will be applied from the commercial operation date onwards for 20 years.



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