‘Cost of energy is done’: Belgian minister says auctions to judge wind on more than price

Belgium’s energy minister said the wind industry has won the argument on power price – but will in future have to convince regulators about a range of other factors such as sustainability and citizen participation, as she backed calls to “expand the narrative” beyond levelised cost of energy (LCOE).

Asked whether auction criteria for wind power should be widened beyond simply rewarding the lowest cost – the model so far in large-scale tenders run by most European governments – Tinne Van der Straeten told WindEurope’s Electric City conference: “To put it very bluntly I’m confident on the price issue – LCOE is done.”

Auctions brought in to replace fixed feed-in tariffs have been widely credited with helping wind achieve spectacular cost reductions across Europe and further afield. But Van der Straeten said a consultation to be launched by Belgium in the new year over its future market criteria “will not be on price alone”.

“When it comes to auctions, I’m very confident prices have come down, [that] there is competition. For me that’s settled – I have other objectives when I’m doing an auction.”

Be sure and be warned that these will be part of the auction criteria.

Van der Straeten told a panel during the opening of Electric City that these could include the sustainability of projects during construction, and opportunities for citizen participation in projects – including in offshore wind farms.

“Be sure and be warned that these will be part of the auction criteria.”

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‘Shift focus onto value’

The Belgian minister spoke as she backed a call by Vestas chief sales officer Javier Rodriguez Diez to “expand the narrative around the wind industry far beyond the LCOE reduction argument” that has dominated the industry’s agenda for more than a decade as it strove to prove it could be competitive with other sources of power.

“Wind has become a mainstream source of energy,” Diez said. “We have many, many other positive things [to offer]. We will have to shift the focus onto the value that we create for society.”

There was a warning, however, against losing too much focus on pressing down on power price from German secretary of state in the federal energy ministry, Andreas Feicht. He cautioned that “we lost the PV industry in Germany because we didn’t put too much pressure on the prices”, noting that intense competition in the wind industry had allowed it to make huge strides in cost reduction.

Feicht said “innovation auctions” that take into account technological factors such as adding storage capabilities to projects could be a way forward.

But he spoke out strongly against anything that brought local content requirements into the equation. “That smells to me very much like protectionism,” he said.

This post appeared first on Recharge News.

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