Joint procurement and purchase of solar power
About this good practice
The joint procurement and purchase of solar power was organised as a part of the North Karelia Towards Oil-Free and Low-Carbon Area project (ERDF) with an objective to increase the share of renewable energy in the region of North Karelia, Finland. The project, managed by the Regional Council of North Karelia (RCNK), looked for and tested new methods for developing markets for cleantech solutions and products. Joint procurements and purchases were one of the methods.
Together with the Finnish Environment Institute and the Carbon Neutral Municipalities (HINKU) network, RCNK planned and organized joint purchase for solar power units which was addressed to residents and private companies in HINKU municipalities in North Karelia. They organized five information events, advertised in and communicated through local and regional newspapers and social media. More than 250 people were contacted in this process.
Planning of the purchase took place in July-August 2016, events were organized in September 2016, registration of interested participants in October-November 2016, invitation to tender in December 2016, comparison of offers in January 2017, and installations of 41 solar power units in April-June 2017. RCNK requested tenders for 2.5, 4.5 and 7 kWp units. Prices were about 30 % lower than the average market price.
Stakeholders involved in implementation: public authority, research actors, industry, civil society. Beneficiaries: industry, residents.
Expert opinion
Everybody with a little knowledge of the PV sector knows the big price differences between single family roof-mounted PV systems when purchased as single unit, and utility-scale PV plants: costs per kWp can easily be double or even higher for single systems compared to large-scale units. However, single units are household level are most in line with the local energy transition, the ideal of power generation where the demand is located and also also an energy transition close to and for the benefit of the citizens who can enjoy their own, ideally cheaper, onsite electricity from their own systems. Scale economies bring down costs, and this ingenious good practice from North Karelia shows how the public sector can help bring down the costs of individual PV systems for thier residents by bundling the demand and organising a joint procurement. This very replicable and easy to transfer good practice is of interest to any regional and local authority that wishes to foster the penetration of citizen-owned renewables in their territory.
Resources needed
The project budget was 655,015 € (70% ERDF).
Resources are needed for planning and organising procurement, comparing offers and purchasing solar power units & installations.
Regional municipalities provided event venues and promoted joint purchase for their residents
Evidence of success
41 new solar power plants (142.4 kWp) were installed. Around 60 % of the participants were from rural or agricultural areas. Process was effortless for them: they did not need to find suppliers and were offered guidance and help from an unbiased organisation. The units were about 30 % cheaper than the average market price. In 2017, the region’s CO2 emissions decreased by c. 20,000 kg due to the installments.
During second round in 2018, 22 more participants joined, of which 80% were rural.
Potential for learning or transfer
Solar power is increasingly seen as a cost-effective way to produce energy also in Finland.
Joint purchases have offered an easy way for purchasing solar power. The method has been tested couple of times and it is easy to transfer to other areas.
The practice has high-impact potential and the events organised by the project are good tools for raising awareness of renewable energies, their benefits and investment potential.
Another joint procurement and purchase of solar power was implemented in 2018. This time the equipment supplier was selected before organising information events to households and companies.
Good practice owner
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