New renewable energy projects are gearing up with little or no governmental support. Last week an announcement was made by the French electric utility Engie. The Engie is planning to develop three hundred megawatts of wind energy. The project is being designed for the accomplishment across nine wind farms in Spain. On an average, the investment for the project stands out to be of three hundred and fifty million dollars. The primary focal point here is that the Engie is accomplishing its project without any governmental funding.
Before this, a Swedish power company Vattenfall announced in March 2018. It won a bid of building seven hundred-megawatt offshore wind farm in the Netherlands. This project would represent first nonsubsidized wind energy project in the windmills land.
The Federal grid regulator accepted about four bids in Germany. The proposals were placed in Germany’s first competitive power auction in last spring. The total value of the recommendations accounts for a total of about one thousand four hundred and ninety megawatts. This value represents the offshore wind capacity in the North Sea. The average subsidy rate was €0.44 per kilowatt-hour. The low rate is due to the lowest subsidy rate bid of zero made by the Danish wind energy firm Dong.
All the above facts indicate that the majority of the renewable energy projects can progress ahead without the financial aid from the government’s. Instead of this, the European Union is planning to rule out the subsidies for the renewable energy projects. This ruling out of the grants goes in hand with the expensive nature of the policies for renewable energy.
At the Carbon Brief, Simon Evans wrote, “Overcoming the higher cost of financing subsidy-free schemes is one hurdle; managing variable renewables on the grid is another. Meanwhile, governments must weigh the appeal of hoping the market delivers zero-carbon electricity without policy support, against the risks of failing to meet other priorities.”