Well-Designed Auctions Promote Cost-Efficient Development of Renewable Energy Projects

In an article for Euractiv, Guidehouse discusses considerations for designing renewable energy auctions in countries with a growing renewable energy sector

Auctions, or competitive bidding processes, are currently used by policymakers to determine which renewable energy projects receive support and to what degree. In today’s market, they help promote cost-efficient development of renewable energy projects, effectively driving renewable energy costs down.

In an article for Euractiv, Guidehouse experts explain that designing auctions for countries with a growing renewable energy sector comes with unique challenges and considerations, including existing project pipelines and qualification criteria for auction participation.

“Policymakers should seize the opportunity to implement well-designed, tailored auctions that build and de-risk their renewable energy markets to enable low prices and sustainable market growth,” said Geoffrey Ho, associate director at Guidehouse. 

The article explains that there is no one-size-fits all approach. Auction design needs to account for local market conditions, particularly as energy sector reforms happening in countries with emerging renewable energy markets can create additional uncertainties for developers and lenders.

“The design must always account for local context and differences between countries, particularly renewable energy market maturity and energy sector liberalization,” explained Ho.

Read the Euractiv Article

About the Experts

Back to top