Solar Ireland warns RESS 6 price cap could restrict competition and project delivery
Solar Ireland has raised serious concerns that the €110/MWh maximum offer price for solar projects under the sixth Renewable Electricity Support Scheme auction may not adequately reflect current project costs and delivery risks.
The maximum offer price is unchanged from RESS 4 and RESS 5. When inflation is taken into account, maintaining the same nominal cap represents a reduction in real terms, despite increases across grid connections, electrical infrastructure, construction, equipment, labour and financing.
In the lead-up to the final withdrawal deadline, Solar Ireland raised these concerns directly with the Department of Climate, Energy and the Environment. This engagement was informed by confidential feedback from members indicating that projects were likely to be withdrawn, reduced or reassessed because of viability concerns.
The Department has since confirmed that several projects withdrew before the deadline. The reasons for each withdrawal and the amount of solar capacity affected have not yet been published.
Changing project economics
Members have reported significant increases in the cost of delivering solar projects. These include higher electrical balance-of-plant and grid connection costs, rising financing costs and anticipated increases in module costs for projects due to be delivered in 2028 and 2029.
Developers must account for these future costs and risks when preparing bids today. The RESS 6 framework also places stronger restrictions on withdrawal after a successful project has entered the scheme, making it even more important that bids are based on realistic assumptions.
The impact may be particularly acute for smaller projects, which have less capacity to absorb substantial connection and infrastructure costs. This risks reducing the number and diversity of projects competing in the auction.
Ronan Power, CEO of Solar Ireland, said:
“This is not simply about developer margins. It is about whether projects bidding within the cap can secure finance, connect to the grid and ultimately be built.
“Consumer affordability must remain central to RESS, but affordability and project viability need to work together. A competitive price on paper represents poor value if the project cannot reach financial close or deliver electricity.
“The success of RESS 6 should be measured not only by the auction price or the capacity awarded, but by how much renewable electricity is ultimately connected to the grid.”
Delivery must remain the test
Solar Ireland supports competitive auctions that protect consumers and deliver affordable renewable electricity. However, competition depends on auction parameters that allow a broad range of credible projects to participate.
A cap that excludes otherwise viable projects could reduce competition, favour only the largest developments and place Ireland’s 2030 solar target at greater risk.
As RESS 6 progresses, Solar Ireland is calling for transparency on the number and capacity of solar projects withdrawn, the volume proceeding to auction and the eventual delivery of successful projects.
Solar Ireland will continue gathering evidence from members and engaging with the Government to ensure that future auction design reflects the conditions under which projects are financed, connected and built.
UPDATE: The concerns raised by Solar Ireland were reported by Daniel Murray in the Business Post.