India’s Wind Energy Tariff Falls To Record Low In Latest Tender
Intense competition and few alternatives seem to have pushed the wind energy tariff bids in India to record lows.
The second national level wind energy auction witnessed massive competition among project developers. The 1 gigawatt tender garnered 12 bids with cumulative capacity of 2.9 gigawatts.
The 1000 megawatts of capacity was awarded to five developers in a tariff range of ₹2.64-2.65/kWh. One of India’s leading renewable energy IPPs — ReNew Power Ventures — secured 250 megawatts. A subsidiary of Orange Renewables won 200 megawatts, Inox Wind and Green Infra secured 250 megawatts each, and Adani Green Energy won 50 megawatts.
The tariff bids are a sharp correction from those seen in India’s first-ever wind energy auction. The lowest bid in the February 2017 auction was ₹3.46/kWh. The new bids are also lower than those seen in the recent state-level tender issued and awarded by Tamil Nadu. The state allocated 250 megawatts of capacity each to two developers at a tariff of ₹3.42-3.43/kWh.
As many media outlets noted, the tariffs are way below the ₹3.20/kWh cost of generation of thermal power by NTPC Limited. So what is the reason for such low tariffs?
Since the announcement from the government that wind energy projects will be allocated through auctions by the Solar Energy Corporation of India, many states have shifted away from feed-in tariff regime toward competitive auctions. Several states refused to honor power purchase agreements with commissioned projects, while others launched tenders to acquire wind energy.
The wind energy tariffs are now at levels similar to solar power tariffs. The lowest solar power tariff in India is ₹2.44/kWh. Apart from the sharp fall in module prices, local and tender-specific conditions have contributed towards this rapid decline in tariff bids.
As with several national-level solar tenders, the wind energy tenders too have an off-taker reducing financial risk to the developers. In the case of wind energy tenders issued by Solar Energy Corporation of India, the off-taker is PTC India Limited, a government-backed company.
Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here.
Latest CleanTechnica.TV Video
CleanTechnica uses affiliate links. See our policy here.
