Recent disruptions to global renewable energy supply chains have increased equipment and shipping costs, intensified inflationary pressures and contributed to higher financing costs for renewable energy projects. At the same time, the geographic concentration of critical minerals, manufacturing capacity and processing activities has raised concerns about energy security, exposure to geopolitical risks and countries’ ability to capture value from the energy transition. These challenges highlight the need for public policy and procurement frameworks that can support continued renewable energy deployment while strengthening supply chain resilience.

This report examines how renewable energy auctions can help manage immediate supply chain shocks and support the longer term development of more secure and diversified value chains. It provides guidance to auction authorities on how key parameters—including project lead times, ceiling prices, contract indexation, penalties and bonds, auction volumes and frequency, grid-capacity allocation, PPA currency denomination and qualification requirements—can be calibrated with supply-chain risks in mind. It also assesses the use and limitations of local content requirements, environmental criteria and multi-criteria awards to promote local value creation and more sustainable supply chains.

Recognising that auction design cannot address these challenges alone, the report sets out an integrated policy approach combining measures to anticipate and absorb immediate shocks with longer-term structural policies. It highlights supply chain risk mapping, diversification, trade facilitation and international cooperation, alongside renewable energy deployment, industrial and beneficiation policies, finance, skills development, innovation and circular economy measures. Together, these insights offer policymakers and auction authorities practical options for balancing affordability, project delivery, resilience and domestic value creation.

Report by the International Renewable Energy Agency