Uttar Pradesh, one of the largest power consuming states in India, has long been a laggard in setting up solar power projects, and increasing the share of solar power in its energy mix. All that, it seems, is about to change very soon.
After a gap of a few years, the state government issued a tender to set up solar power projects under the state policy, and it has received tremendous response. Uttar Pradesh has had cases of retrospective reduction in tariffs under its earlier auctions which may have prompted developers to stay away from this latest tender, however, the expected increase in power demand and change in political environment in the state, along with other factors, seem to have gained the attention of developers.
In response to a 1 gigawatt solar power tender launched by the Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA), a total of 13 project developers have submitted bids to set up 1.87 gigawatts capacity.
The list of developers interested in setting up projects includes a who’s who of the Indian solar power market. Acme Solar (300 megawatts), Azure Power (300 megawatts), ReNew Power (280 megawatts), Adani Green Energy (250 megawatts), and Essel Infraprojects (250 megawatts) are the major Indian developers who have participated in the bidding. Canadian Solar (100 megawatts) and EDEN Renewable (50 megawatts) also placed technical bids, representing the international players.
The financial bids for the projects are expected to be completed by July, 2018, an unnamed UPNEDA official told Mercom India.
Another development in the state was allocation of some projects under the central government policy, through the Solar Energy Corporation of India (SECI) Limited. Tenders to set up 275 megawatts of capacity in six solar parks across Uttar Pradesh were issued by SECI in January 2018. Mercom India is reporting that capacity has been allocated in at least two of those solar parks.
Acme Solar has secured rights to develop 75 megawatts of capacity in Parasan solar power park and 50 megawatts of capacity in Gujrai solar park. The winning bids for these projects were Rs 3.32/kWh (4.88¢/kWh) and Rs 3.38/kWh (4.96¢/kWh). These bids are higher than those seen in other recent auctions, but are justified given the smaller size of the projects and lack of experience among developers to set up projects in Uttar Pradesh. We reached out to Acme Solar officials for comments, however, they didn’t respond before the time of publication.
Uttar Pradesh, as of 31 May 2018, had an installed solar power capacity of 472 megawatts. As per guidelines of the Ministry of New and Renewable Energy (MNRE), the state should have an installed solar power capacity of 10,697 megawatts by March 2022.