State governments across India are implementing highly ambitious plans to rapidly expand solar power generation capacity. While a few are roping in private sector companies, most are opting for large government-owned companies with proven track records in the power sector.
Odisha, a southeastern state in India, has asked the country’s largest power producer, NTPC Limited, to set up an ultra mega solar power project. The company is already working on two large-scale super-critical thermal power plants in the state.
The Odisha government has been directed by the central government to set up 500 solar photovoltaic power projects. NTPC has already signed agreements with Andhra Pradesh to set up 1 GW capacity and Madhya Pradesh to set up 750 MW of solar PV projects.
As these agreements have been signed directly with NTPC, it is likely that these projects would be separate from the solar power project auctions that many states plan to conduct. Such projects could thus prove to be a game-changer for the domestic solar PV module manufacturers.
Being a government-owned company, NTPC is likely to opt for domestically manufactured solar PV modules instead of imported ones. This is the strategy likely to be adopted by the Indian government to promote domestic manufacturers while complying with WTO rules.
The Indian government plans to set up several ultra mega solar power projects — power plants with more than 500 MW installed capacity. This way the government hopes to achieve sustainable grid parity between solar power and conventionally produced power. Such projects may also be granted special status probably allowing them to access low-cost financing.
NTPC Limited owns over 43 GW of power generation capacity in India, about 17% of the total installed capacity in the country. This includes 95 MW of solar power capacity, which the company hopes to increase to 1 GW by 2017. However, it has already signed agreements to set up 3 GW of solar power capacity across several states.
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