German biomass tender awards 243 MW at reduced prices

Germany's Federal Network Agency allocated 243 MW of projects for biomass-fired power plants in its latest tender round, which ended with a significant oversubscription and a decrease in the average prices.

The competitive round attracted a total of 788 bids with a combined volume of 742 MW, or more than three times the target volume of 240 MW. The power regulator said on Thursday that eight proposals totalling 11 MW were for new plants and 780 bids with a combined capacity of 731 MW were for existing systems. No bids were placed for biomethane projects and 36 bids were excluded from the competition.

The number of the awarded projects was 263, of which 257 were related to operational plants. The winning projects were secured at between EUR 0.1416 (USD 0.1497) per kWh and EUR 0.1848 per kWh, while the average volume-weighted value came at EUR 0.1780/kWh, down from EUR 0.1828/kWh in the previous round.

By region, about a third of the successful projects are for capacity in Bavaria, where 127 contracts of 90 MW in total were awarded. Next came Lower Saxony and Baden-Wurttemberg with 50 MW and 33 MW of winning schemes, respectively.

While expected within the biomass industry, the tender outcome indicates the insufficiency of financial incentives for the sector as hundreds of existing plans will seek to renew their support contracts after their initial term expires. At the same time, the withdrawal of biomass from the EEG subsidy regime may lead to the closing of biogas facilities not being able to secure new contracts, a trend that could put at stake the energy transition, said Sandra Rostek, head of the Capital Office for Bioenergy.

The next tender for biomass-fired capacity is due to be launched on October 1.

(EUR 1.0 = USD 1.069)

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