Published on May 15th, 2019 | by Saurabh0
Project Developers Continue To Avoid Renewable Energy Auctions In India
May 15th, 2019 by Saurabh
Project developers in India are unwilling to bid for large-scale solar and wind energy tenders, sounding alarms across government circles. The western state of Gujarat witnessed significant under-subscription of solar and wind energy tenders last week.
The state of Gujarat managed to attract bids for only 900 megawatts against an offered capacity of 1.7 gigawatts across two solar power tenders. So far only 500 megawatts of capacity has been allocated to project developers from among the 900 megawatts.
The first tender with capacity of 700 megawatts was issued for the Raghanesda Solar Park. Only four companies placed bids to set up a total of 600 megawatts of capacity. These included Tata Power Renewable Energy, Engie, and two government-owned companies. The maximum tariff that developers could bid for in this tender was Rs 2.70/kWh (3.8US¢/kWh).
All the four initial bidders managed to secure rights to develop projects after the financial bidding round. However, only 500 megawatts capacity was auctioned as the state government decided to reduce the capacity on offer from 700 megawatts to 500 megawatts after the 100 megawatt under-subscription.
Engie secured 200 megawatts at the lowest tariff bid of Rs 2.65/kWh (3.8US¢/kWh) followed by two state government-owned companies which secured 100 megawatts each at Rs 2.68/kWh (3.84US¢/kWh) tariff each. Finally, Tata Power Renewable Energy secured 100 megawatts at Rs 2.70/kWh.
Gujarat had auctioned the same capacity for the same solar power park in January 2019. The 700 megawatt tender had received bids for 1.75 gigawatts at that time. However, after the completion of financial bidding, the state government decided to scrap the auction. Tariff bids realized in that auction ranged from 2.84/kWh (4.08¢/kWh) to Rs 2.89/kWh (4.15¢/kWh). This could be one of the major reasons for several leading project developers staying away from the auction.
Gujarat has also issued a tender for the first phase of Dholera solar power park. The Gujarat government plans to set up a 5 gigawatt solar power park at Dholera, which will make it one of the largest solar power parks in India. The government had offered 1 gigawatt of capacity in the first phase but drew bids only for 300 megawatts from two developers.
Finally, 250 megawatts were auctioned to a state government-owned company and Tata Power Renewable Energy at a tariff of Rs 2.75/kWh (3.91US¢/kWh).
Last month, the Solar Energy Corporation of India suffered a setback when developers submitted bids only for 600 megawatts compared to the offered capacity of 1.2 gigawatts in the seventh edition of the national wind energy auctions.