Photovoltaic bidding does not allow cost estimation to be a mystery

Since the 280MW PV concession bidding revealed a low price of 0.7288 yuan/kWh, the market has been curious. What kind of cost accounting can support such a low price? Will you lose money? However, this suspense may eventually become a mystery, because the authority of the Energy Authority revealed that the specific cost accounting content will not be published together with the announcement of the price, the successful bidder.

Following China's first round of bidding for PV concessions last year, which resulted in a bid price of RMB 0.69/kWh, a low price of RMB 0.7288/kWh was disclosed in the concession tender this year. However, the difference is that last year's PV tenders ultimately abandoned the lowest price of 0.69 yuan/kWh, and selected the low price of 1.09 yuan/kWh as the bid price; this year, authoritative sources revealed that 13 projects will basically choose The lowest price, which is 0.7288 yuan/kWh, is expected to become the final bid price.

This means that this year's PV on-grid tariff will be 0.36 yuan/kWh lower than last year. Among the bidders who reported low prices, the central enterprises accounted for nearly 70%. For a time, many voices believed that the central enterprises did not hesitate to “enclosure” low prices and damage the industry’s reasonable cost and profit margins. In this regard, the government departments that sponsored this tendering expressed their adherence to the principle of “lowest bid for bids” and respected the company’s own cost estimation logic.

What kind of on-grid tariff is reasonable? This huge doubt makes it necessary to analyze the cost-to-income of photovoltaic bid-winning companies, and all this is hidden in bids submitted by bidders. However, an authoritative source from the Energy Bureau revealed that when the bid price was announced and the company was awarded, it would not announce the contents of the bid. The content of cost accounting was naturally a mystery.

After all, for a company reporting 0.7288 yuan/kWh, it is virtually impossible to judge whether the above-mentioned on-grid tariff is too low before analyzing its specific cost accounting. Some people believe that the tender is limited to the on-grid tariffs of several projects. Due to the limited number of projects, it is not ruled out that the central SOEs have to pay for the loss in order to enter the market. Some experts predict that according to the current bidding price, some low-price winning projects are expected to be profitable after 17-18 years, and the franchise period for these projects is only 25 years.

If so, can companies that report low prices be able to withstand a loss period of up to ten years in the future? At such a low price, can the supply of photovoltaic components be stable and sustainable during the period? How can the quality of photovoltaic components be guaranteed? Although this appears to be an issue that the company itself needs to solve, if the company finally chooses to give up halfway, how does the significance of this round of tendering manifest?

In order to avoid the above problems, it is necessary to make detailed scrutiny of the bidding price while selecting the winning bidder, avoiding the phenomenon of quick success and instant winning, and avoiding short-sighted behaviors from burying hidden dangers in the development of the industry.

Of course, there are also views that, in this tendering, companies calculate the final on-grid tariff based on their own situation and the selected suppliers. Therefore, their respective costs are different, and companies that do not necessarily report low prices will certainly lose money. If so, this means that some companies can reduce costs to a reasonable space, which is a boon for the popularity of photovoltaic power generation.

No matter what kind of possibility, it is necessary to fully demonstrate the cost measurement of the successful bidder to ensure its feasibility and effectiveness, so that it can promote industry competition, achieve survival of the fittest, avoid hidden dangers in the industry, and can also implement concession bidding. Benefit the original intention of the development of the industry.

Therefore, even if the company does not publish the details of the calculation of the cost of the ultra-low-cost successful bidder, it should also instruct the third-party professional organization to account for the construction and operation costs of the photovoltaic project, so as to ensure that the development of the industry tends to be rational.