India’s solar power tariff bids rallied over 6% in the first major national-level auction following the imposition of safeguards duty on imported solar cells.
India’s largest power generation company — NTPC Limited — had issued a national-level solar power tender worth 2 gigawatts of capacity. The tender was virtually similar to the ones issued by the Solar Energy Corporation of India (SECI) wherein developers are free to choose the location of their projects. In such tenders, NTPC (and SECI) sign back-to-back power purchase agreement with project developers and distribution companies interested in solar power procurement.
Acme Solar was again the lowest bidder in the auction, as has been the case in similar auctions over the last few months. The company quoted a tariff of Rs 2.59/kWh (¢3.60/kWh) to develop 600 megawatts of solar power capacity. This allocation is jointly the single-largest allocation of solar power capacity in any tender.
Acme secured rights to develop 600 megawatts of capacity in the tranche-I of SECI’s national-level solar power tender worth 2 gigawatts. The company had placed a tariff bid of Rs 2.44/kWh (¢3.39/kWh), jointly the lowest-ever solar power bid in Indian history for large-scale projects. The company again secured 600 megawatts of capacity at the same tariff in the tranche-II of SECI’s national level solar power auction. In fact, allocation of 2.4 gigawatts of capacity was cancelled in tranche-II auction as SECI believed that the tariffs quoted by all developers except Acme were too high.
SoftBank-backed SB Energy also secured 600 megawatts capacity in the NTPC tender, at Rs 2.60/kWh (¢3.61/kWh) tariff bid. This is the company’s largest-ever win in any Indian solar power auction. It had actually placed a bid for the entire 2 gigawatt tendered capacity. It lost the 1.1 gigawatt capacity allocated to it in SECI’s tranche-II auction following partial cancellation of the capacity allocation.
Two other companies — Shapoorji Pallonji and Azure Power — secured rights to develop 500 megawatts and 300 megawatts of capacity respectively, at tariff bids of Rs 2.59/kWh (¢3.60/kWh) each.
The encouraging part of this tender was the overwhelming participation by a number of project developers. Being the first major auction after safeguards duty was imposed on imported solar cells, the industry as well as the government would have had a close eye on the tender’s results.
A total of 15 companies placed cumulative bids to develop 6.3 gigawatts of capacity against the offered capacity of just 2 gigawatts. Apart from the 1.4 gigawatts lost by SB Energy, 11 other developers with bids to develop 2.9 gigawatts of capacity. These companies had placed bids in the range of Rs 2.61/kWh (¢3.63/kWh) and Rs 3.10/kWh (¢4.31/kWh).
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