MET Group is currently marketing a 200 MW portfolio of stand-alone battery projects in Germany, anticipated to achieve ready-to-build before the end of the year, CEO of Renewables Development Christian Hürlimann told NPM.
Source: NPM Europe (New Project Media)
He did not disclose when a close might be achieved, but said that the renewables developer is in ongoing, in-depth conversations with potential buyers.
“This is quite an interesting proposal since the flexibility market in Germany is attractive at the moment, because of the low solar capture prices and the general volatility in the market due to a lot of renewable generation units,” said Hürlimann.
“The more renewables come online, the more flexibility is needed, and particularly the renewable based flexibility units are the ones that will be of interest.”
Set to capitalise on this interest, Hürlimann said that MET has additional German BESS projects in the pipeline, ranging between 60 MW and 110 MW, that may enter the market in the coming months.
He did not discuss specific expectations on sales price, but highlighted that figures remain at the premium seen at the end of 2024 and early this year. German industry sources have in recent weeks indicated to NPM that RTB German BESS projects can fetch valuations ranging from EUR 50,000/MW to up to EUR 150,000/MW, with many assets trading around the middle of this spectrum.
While it was expected that prices would fall as more projects came to the market, this hasn’t been the case due to delays faced in BESS achieving ready to build status, particularly due to grid delays.
As a result, Hürlimann anticipates that elevated prices will remain through to the end of the year.
Wider pipeline
As well as Germany, MET is also developing renewables in Hungary, Bulgaria, Italy, and Romania.
Its focusses are onshore wind, solar, co-located batteries, as well as standalone BESS, though its operating portfolio currently includes wind projects in Bulgaria (102 MW), and solar in Hungary (262 MW) and Spain (50 MW). This is primarily comprised of solar PV, but includes onshore wind and BESS. Additionally, the group’s flexible assets division is currently commissioning a 40 MW / 80 MWh battery in Hungary.
Earlier on in the delivery process, MET has around 110 MW of solar PV under construction in Italy (20 MW), Germany (more than 10 MW), and Romania (80 MW). The 80 MWp Romanian solar PV project is expected online before the end of the year.
“[For] all of the operating solar assets, and also the ones that we have in construction, we’re developing co-located batteries,” said Hürlimann. “We are working to use the existing land, because typically we have additional land available where we develop co-located batteries.”
He added that typically MET waits for development to be complete, before it then begins work toinclude a co-located BESS asset.
Currently, the developer has 500 MW of hybridisation initiatives underway.
MET’s pipeline further includes more than 1 GW of renewables at various stages of development,ranging from securing land and grid connections, to mid-stage projects anticipated to reach ready-to-build in the next year.
This includes a 60 MW PV + 60 MW BESS project in Germany, and several Italian projectsexpected to achieve RtB before the end of 2025.
“Beside constructing our first project in Romania, at the moment we’re scheduling the additionalthree projects in a way that we can properly manage the final development of a specific projectand then its construction,” Hürlimann added.
Two Romanian PV projects totalling 124 MW are already at ready-to-build and approaching a finalinvestment decision, though Hürlimann was unable to offer an estimate of when this would beachieved.
A third circa 50 MW PV project [with co-located BESS] in Romania is also approaching ready-to-build.
MET expects it will make use of the experience, knowledge, and network in gains from deliveringthe 80 MWp Dâmbovița project currently under construction, to help put its additional Romanianprojects into construction.
While Hürlimann did not discuss expectations on construction cost, he noted that MET typicallyfinances its renewables projects with equity. It may later look to refinance with project finance.
Revenue focus
When it comes to revenue, MET has previously prioritised contracted revenues.
“The first projects [in our renewables portfolio] were backed by CfD schemes, and now the firstprojects are out in the market, or about to go out into the market because the CfD period is ending– particularly the wind projects in Bulgaria,” Hürlimann said.
Pursuing long-term tariffs remains part of the strategy. For example, the circa 10 MW projectunder construction in Germany has secured a tariff under the country’s EEG scheme and isconsidering additional projects for submission, particularly in Germany and Romania. However,newer MET projects will also pursue merchant revenues from the start with hedging via PPAs.
Hürlimann said: “We are looking at a structure where we have a part that we could hedge, withlonger term PPAs…but because of [the group’s] trading focus, we also want to have certainmerchant positions…so we’re looking at a diversified, structured offtaking portfolio which is incertain way de-risked but in a certain way also leaves us opportunities for the future.”
He noted Germany as offering a mature PPA market, but highlighted that solar capture prices arecurrently quite low, making for an unattractive price environment. “But there are [still] possibilitiesto seal deals to provide renewable power, together with GoOs [Guarantees of Origins], to industrialclients,” said Hürlimann.
Meanwhile, in the Italian market, Hürlimann cites an increase in PPA transactions. For its part,MET announced a 10-year wind PPA with Eredi Gnutti Metalli in early June, and another Italiandeal is currently being negotiated.
Further discussing Italy, Hürlimann said: “The industrial players seem to be interested in securingrenewable power on a price level they can calculate with, so it’s all about the industrial clientsfixing their prices for the future… And the Italian market is still at a premium, the prices are still higher, and also the capture prices are not that much lower for solar so that it is still interesting for us as operators to have a PPA.”