Utilities Middle East
Potential in floating solar PV
The outlook for FPV is positive and is set to break free of its niche perception, says Frank Haugwitz, Senior Advisor, Apricum
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, 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.
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 gridparity 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’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.
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.
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.
Floating PV systems are not new, given that the first system (for R&D) was already installed in Aichi, Japan in 2007. The following year, the first FPV-related patent was officially registered and the world’s first commercial installation, a 175 kWp system built at the Far Niente Winery in Napa Valley, California, became operational. The owner’s primary motivation to deploy a FPV system was to avoid occupying land and to reduce water evaporation.
Geographical considerations are naturally a key driver for FPV. Countries subject to high population density, low percentage of flat terrain, competing use for available land, etc., but at the same time, home to a significant number of available water bodies, both often in proximity to load centres and existing grid infrastructures, were among the first to consider FPV systems as a way to further scale-up solar power generation capacities. Land scarcity is an ever pressing issue, as illustrated by South Korea, where 70% of the land is mountainous.