Global solar power solutions provider has several PV projects under development in addition to ongoing negotiations with local project developers. The aim is to expand Photon Energy’s own portfolio of power plants. In the long term the company also wants to be active with its EPC division and as a provider of operations and maintenance of PV power plants. A set of factors make Hungary a promising market for solar energy.
“We have been evaluating the market very carefully and are now confident enough to announce that we have decided to both enter into the proprietary development of projects and to seek cooperation with local project developers to bring PV projects to the bankable ready-to-build stage”, says Photon Energy CEO Georg Hotar.
In a first step, through the fully-owned subsidiary Photon Energy HU SPV 1 Kft., Photon Energy is developing projects with a total installed capacity of some 6 MWp in a location near Budapest (details withheld for competitive reasons for now). Concurrently, Photon Energy is evaluating other locations for greenfield development as well as the cooperation with several local developers.
A combined set of factors points to Hungary becoming a promising market for solar PV in the next couple of years. With a share of 11% of electricity consumption being generated from renewable energy sources in 2016, Hungary falls significantly short of its EU commitment of 20% by 2020. Hungary has limited potential for other renewable energy sources and thanks to the material decline in investment costs for PV plants and local financing costs in combination with functioning support mechanisms provide for the commercial viability of PV plants in Hungary. Off-take prices for renewable energy around EUR 100 per MWh for up to 25 years allow for attractive returns for investors, while local banks have a strong mandate and appetite to provide long-term project financing on attractive terms.
“After our correct decision to avoid past opportunities in Bulgaria, Romania and Turkey we feel confident in the fundamentals of the Hungarian market. As an experienced and committed player on the market we aim to realise at least 50 MWp of new PV projects both for our portfolio and third-party investors in the next couple of years. At this point we are confident to commence the construction of PV plants in Hungary still within 2017”, Hotar concluded.
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