Energy ministry launches funding scheme for 50MW in solar farms

The energy ministry this morning launched a support scheme for private entities wishing to set-up solar farms. The scheme will offer support to solar farms amounting to a capacity of 15MW in its first, going up to 50MW by 2020 – equivalent to an area of roughly 700,000m2.

The scheme will dish out a maximum of €140 million over twenty years and is open until the end of December 2020, with support being given in the form a premium over and above the market price of electricity.

Addressing a press briefing on the scheme, energy minister Joe Mizzi said that that projects would have to be in line with the solar farm policy launched last month by the Planning Authority and the ministry.

The total area that could potentially be used for solar farms, in accordance with the policy is roughly 2.7km2.

Mizzi explained that after problems had been encountered with setting up wind farms in Malta, as was envisaged in the 2010 national policy, Government had decided to focus on the sun, one of Malta’s most abundant resources.

He said that thanks to a number schemes Malta’s solar power contribution had risen from15.7MW to 100MW.

Mizzi said that in addition to helping the country edge closer to its 2020 targets, the schemes had also benefitted “thousands of families” and businesses who were making savings by investing in cleaner and more efficient energy.

The scheme, explained the minister, would take the form of a bidding process, with operators competing with each other for the most competitive and cost-efficient prices. This was necessary in order for the programme not to be in breach of EU state-aid rules. This would only apply for projects with a capacity greater than 1MW.

“We are convinced that the private sector will jump on the opportunity to invest in the sector and ensure a sustainable and clean environment,” said Mizzi of the scheme’s potential.

It was explained that with Malta on track to meet its 2020 target, it was now looking to the next phase in the development of the solar energy sector, solar farming.

Furthermore, Malta was currently working on its 2030 targets, which will no longer be set by the EU, but will be set by each member states, keeping in mind that the union-wide target would be 27%

The competitive system will require an invitation to bid which will require presenting a grid connection study, in order to ensure the project “made sense”. A screening letter from the Planning Authority would also have to be presented.  

In order to qualify for the scheme, sites must fall within the solar farm planning policy however the permitting process need not be completed before applying for support.

According to the policy potential sites for solar farms include: quarries, industrial areas, disused landfills, land under a Government concession and car parks. The cost of developing the area in a solar farm will be considered and preference will be given to areas requiring the least amount of funding.

Bidders will have 18 months to complete installation after receiving support, and each bidder will be required to submit a performance bond, which would be returned one the site is given back.