The Indian state of Gujarat recently completed a wind energy auction, the second for the state since wind energy auctions began in the country. The auction was undersubscribed and project developers remained away as was the case with a recent national-level wind energy tender.
The 1 gigawatt wind energy tender was issued by Gujarat Urja Vikas Nigam Limited (GUVNL). The company had aimed to auction this capacity in order to fulfill its Renewable Purchase Obligation (RPO). The tender was, however, undersubscribed as project developers placed bids only for 931.40 megawatts.
Among the various possible reasons for the disinterest of project developers could be lack of transmission infrastructure to support new projects, contention over tariffs, and GUVNL’s history to cancel auctions citing higher tariff bids submitted by project developers.
As the tender was undersubscribed GUVNL, as per rules, decided to auction just 80% of the initial offered capacity of 1 gigawatts. The lowest successful bids were placed by companies that may not have renewable energy as their core business or have not participated in any of the wind or solar power projects in the past. Of the 745 megawatts of capacity auctioned, these relatively unknown companies managed to secure around 341 megawatts.
The well-known and active participants did bid for around 590 megawatts but managed to secure only around 404 megawatts due to high tariff bids. Powerica Limited secured its third win in 12 wind energy tenders conducted so far and bagged 50.6 megawatts at a tariff bid of Rs 2.81/kWh (4.01US¢/kWh). The company had also secured 50-megawatt capacity in the first wind energy auction Gujarat conducted in December 2017.
Inox Wind, a wind energy equipment manufacturer and a project developer, placed bid for just 40 megawatts at Rs 2.95/kWh (4.21US¢/kWh) and secured the bid. This is the sixth win by Inox Wind in India’s wind energy auctions. Before this auction the average win size for Inox Wind was 170 megawatts.
One of India’s leading wind energy project developers — ReNew Power Limited — successfully placed a bid for 200 megawatts at Rs 2.95/kWh (4.21US¢/kWh). The company, which has participated in seven of the 12 auctions conducted so far, increased its secured capacity tally to 1,475 megawatts, if combined with the capacity won by its subsidiaries the tally reaches 2,125 megawatts, or around 17% of the 12.2-gigawatt wind energy capacity auctioned in India till date.
Adani Green Energy, another major renewable energy power generation company in India, placed the largest bid of 300 megawatts but managed to secure only 113.6 megawatts at Rs 2.95/kWh (4.1US¢/kWh). The company has participated in nine of the 12 wind energy auctions conducted in India so far and now stands with a tally of 1.5 gigawatts.