Solar Photon

HOW-TO: 20kW solar parks in Greece

Dimitris — Sun, 25 May 2008 17:05:00 +0000

Since there is great confusion and misconceptions in the Greek solar market, we are creating a how-to series to present a rough outline of what investors need to know and follow in order to install a 20kW (or less) solar park in mainland Greece. Only for mainland, since RAE has to be involved for any grid-connected solar installation in the islands which makes matters more complicated and time-consuming.

As a backgrounder, a 20kW solar park in Greece currently costs somewhere in the region of ? 100k. 25% of this has to be self-funded, 40% is subsidized by the Greek state and the rest can be anything, typically a loan.

So what does an investor need?

First of all, you need to have access to a piece of land that is more than 4000sq.m. outside city areas or as big as the solar park dictates in city areas (solar parks need planning permission; to get one for any kind of building outside city areas, you need at least 4000sq.m.). You can buy or rent the land.
You must register a company and assign the piece of land to it.
Issue an RFP and get lots of proposals. Differentiation between companies are usually material quality and cost.
Apply to the national electricity carrier (DEH) for connection to the grid network.
Apply for the Greek subsidy.
Sign an agreement with the electricity carrier (DEH) to connect your supply to its network.
Sign an agreement with the company that will be buying your produced power (DESMHE)
Sign an agreement with the material supplier/installer and start materializing the park.
Complete the installation and connect to the grid.
Present a progress and completion report to the Greek state to get the subsidy.

Overall, the process can take up to a year and investors are more likely to spend more than ?50k to kick-off the project since the subsidy will kick in much later. Banks are moving in to provide solar-oriented loans but with relatively high interest (compared to Germany and Spain).

Smaller investors may be reluctant to spend ?100k in a unproven (in the Greek market) investment. However, we expect it to be a matter of time before the Greek public realizes that solar is among the investments that provide quickest turn-around and return of investment. We estimate that for the solar park will pay for itself in 5 years, after which a monthly payment of approximately ?1000 will result from the electricity sold to DESMHE.

RAE analytics (13/5 update)

Dimitris — Tue, 20 May 2008 08:09:00 +0000

The N.3468/2006 article of Greek legislation has been published during October 2006 and reported that 200MW would be installed in islands and at least 500MW would be installed in central Greece.

Following this, RAE has been accepting applications for solar installations of 20-150kW through stages (applications accepted for geographical areas during specific time periods). Theoretically, RAE reports that an application must be evaluated in 10 days after it has been submitted (!) but the committee has seen 6836 applications submitted which makes evaluation a very time-consuming process. It can currently take from 6 months to a year for an application to be evaluated.

RAE posts updated statistics on their webpage (endless spreadsheets with details on all applications). As of May 13th, only 15% of solar project applications have been accepted (109.9MW), while applications that sum up to 9.6MW have been rejected and 732.8MW is the sum of all applications. The majority of applications are near 100kW but there are several near 150kW or lower than 50kW. The following chart illustrates the percentage of accepted, rejected and evaluated applications.

Status of RAE applications for solar installations of 20-150kW
All figures are in MW and the data has been updated on 13th of May 2008.

Legislation update (15 May 2008)

Dimitris — Fri, 16 May 2008 09:42:00 +0000

Apparently, there is going to be a law that will not allow smaller grid-connected installations for the consumer market. This means that smaller projects, usually found in urban areas (rooftops etc) will be illegal and will not be able to connect to the national electricity company, DEH and sell power to the Hellenic Transmission System Operator DESMIE.

The ingenious folks at the Ministry of Environment have decided that smaller, grid-connected installations should be considered industrial – which are not allowed in residential areas (and not as distributed solar installations as classified in other countries, including Germany). Only off-grid solar installations will be allowed in populated areas (don’t ask why they allowed this; off-grid in urban areas is probably useless in most cases).

Greenpeace has published an article on this (only in Greek) that is aptly titled “Tombstone for solar projects” and the press community has started expressing its disdain.

This is the latest in a series of complications on behalf of the Greek State that is trying to promote the development of solar energy in Greece (by buying a solar kWh from Euro 0.45-0.50) but not simplifying the installation and legistation regarding solar energy. The procedures to enter the solar energy market are very complicated, and an applicant has to go through a myriad of commitees to get approved.

We were expecting legislation to get simpler and smaller home projects to be further promoted but we were not expecting the state to completely block smaller installations. In our opinion, the Greek state has opened the solar market backwards: instead of promoting smaller installations first and then moving to MW-parks (so that the public is educated and familiarised with solar energy), they have opened the latter and hindered the home market. There are several reasons why we think the smaller market is of more importance (to be analysed in a future post).

Welcome

Dimitris — Fri, 16 May 2008 09:28:00 +0000

Welcome to your new blog.
We will be posting updates on the Greek solar market as they happen as we are (un)fortunatelly engaged in this rapidly developing market.