PV industry status and trends: Lessons learnt from Thailand's First Five Years of Utility-scale PV Phil Napier-Moore, Project Director, Mott MacDonald 5th June 2013, Renewable Energy Asia 2013
Presentation Overview Industry status and key features Project cost trends from 2009 to 2013 Technical challenges Future industry prospects
Solar PV Industry in Thailand Focus to date in Thailand has been utility scale 1 MW upwards 2 hectares per MW (~3 football pitches) >500 MW now operating >500 MW further under construction National target of 2 GW installed by 2022 Source: DEDE, Thailand
Total Installed Capacity, Thailand (MWp) PV capacity installed in Thailand 1000 900 Thin Film 800 Crystalline 700 Total 600 500 400 300 200 100 0 2010 2011 2012 2013 Sources: The Solar Club, Thailand, 2011; Mott MacDonald project database
Operating PV Plants, Thailand
Key PV Plant Development Trends After 2010, project financing has been used for more than 99% of new capacity; mainly domestic Lenders EPC wrap is the common contracting model more than a dozen active domestic EPC contractors High quality EPC contractors have used international partnering, either with system aggregators or international PV module suppliers Four international inverter suppliers with local maintenance teams now dominate the market
PV Modules Technology and Suppliers To 2012: Crystalline 68% Thin Film 32% 2013: Thin Film 6% Crystalline 94% Thin Film PV yields higher PR, but land constraints and lowered cost differential have reduced popularity To 2012: Europe / Asia US (Other) 10% 8% Japan 42% China 40% 2013: Asia (Other) 14% Japan 36% China 48% Chinese and other Asian PV module suppliers are gaining market share, including in thin film supply Breakdown by capacity; sourced from Mott MacDonald project database
Key PV Operation Trends Most plants operated by the EPC Contractor Plant performance ratios are typically in the range 75-80%; shortfalls from plant downtime Irradiance has typically been higher than projected based on historical measurements Grid overvoltage an (increasing) issue, especially in rural areas related plant outages uncompensated under the PPA
USD/Wp EPC Price Trend 4.00 3.50 3.00 Expected in 2013 2.50 2.00 1.50 1.00 0.50 0.00 2008 2009 2010 2011 2012 2013 2014
USD/Wp PV Module Price Trend 4.00 3.50 3.00 2.50 2.00 1.50 1.00 0.50 Expected in 2013 0.00 2008 2009 2010 2011 2012 2013 2014 Thin-Film Poly-Crystalline
USD/kWp Plant Operational Cost Trend 60.0 50.0 40.0 30.0 20.0 Expected in 2013 10.0 0.0 2008 2009 2010 2011 2012 2013 2014
Return of Typical PV Project in Thailand mthb 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 - Payback for 8.0THB adder (10 years) PV Project Cashflow (P75) Payback for FiT scheme 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Cumulative Costs Cumulative Revenue_6.5THB adder Cumulative Revenue_8.0THB adder Cumulative Revenue_FiT
Return of Typical PV Project in Thailand Comparison between different tariff schemes Tariff Scheme %IRR NPV(10%) 8.00 THB/kWh Adder (10 years) 21.31% 258.5 6.50 THB/kWh Adder (10 years) 17.44% 171.8 5.15 THB/kWh Adder (25 years) 6.08% -106.6
Common technical issues in project design Common design shortcomings Flood mitigation and drainage design Mounting structure foundations Cable selection (capacity, insulation) Materials selection with respect to corrosion Equipment suitability to environment DC breakers (high temperature in string box) Inverter response to high humidity / temperature
Challenges seen in operational plants to date Unusually high inverter outage hours at some plants Protection settings and nuisance tripping (wrt overvoltage) Lack of local maintenance staff for some suppliers Poor repairs; affecting electrical terminations Intelligent monitoring of plant performance not yet standard practice Accurate irradiance measurement in plane of array Synchronised plant AC output measurement Software to meaningfully interpret operational data
Challenges compared with conventional power Standards for inverter based generators still evolving Lenders becoming nervous on grid availability for intermittent renewable generators Standard PPA form for all SPP/VSPP renewable generators (non-firm) No compensation in the event of grid outage Force Majeure for interruptions in the distribution system Improve strength of priority dispatch terms for renewable generators? Improve information from off-taker load flow scenarios?
Challenges compared with conventional power Lack of standard conventions, codes, standards etc for performance test procedures Skilled O&M to optimise operational performance Both proactive and responsive maintenance Troubleshooting, using limited monitoring data Regulatory certainty to invest in skill-base
Future industry prospects New PPAs are gradually being awarded, as unfulfilled previous PPAs expire Developers and investors are also exploring other Asian markets e.g. Malaysia, Japan, Myanmar, Laos Retention of skills in domestic market depends on implementation of the new feed-in tariff within 2013 Likely new focus on rooftop developments Small scale developments also require new support: Regulatory simplification (e.g. no factory licence needed) Installer training and certification scheme
Thank you for your attention
Return of Typical PV Project in Thailand Preliminary Assumptions for Return Analysis Fixed Poly-Crystalline 7.5 MWp 10,547 MWh at P75 Annual Degradation 0.5% pa. EPC cost at 1.55 USD/Wp and equals to 80% of capex Opex cost at 53 USD/kWp with 3% annual inflation TOU 3.8548 THB/kWh (peak) and 2.0424 THB/kWh (offpeak) Ft (whole sale) in April 2013 0.4063 THB/kWh 1.5% escalation is applied to TOU and the Ft Daily peak portion 61.5% Currency 31 THB/USD