Solar tariff of Rs 2.55 per unit discovered in latest auction

By: |
April 17, 2020 4:15 AM

The auction had received a positive response from investors with NHPC receiving bids of 3,540 MW for the tender. This is a shift from the recent trend of tenders being under-subscribed.

The country has set a target to raise the capacity of installed renewable energy generation plants from the current level of 86.8 GW to 175 GW by the end of 2022.

The latest reverse auction for 2,000 mega-watt (MW) of solar capacity, conducted by NHPC, has discovered a tariff of Rs 2.55 per unit. Though this is higher than the lowest bid of `2.50/unit in the auction for 1,200 MW of solar capacity held in February, it is still much lower than Rs 2.71/unit in the last major solar auction in October, 2019.
According to sources, SoftBank Group’s SB Energy, Axis Energy Group (backed by Canadian investment firm Brookfield), O2 Power and New York-based Eden Renewables’ Indian arm have been awarded 600 MW, 400 MW, 380 MW and 300 MW, respectively, all at Rs 2.55/unit. Avaada Energy was awarded 320 MW at Rs 2.56/unit against their bid for 600 MW.

The auction had received a positive response from investors with NHPC receiving bids of 3,540 MW for the tender. This is a shift from the recent trend of tenders being under-subscribed. As it was with the last major solar tender auctioned by SECI in February, the winning developers are backed mostly by foreign capital. The renewable energy industry is one of the major FDI earners with the sector attracting $4.8 billion foreign capital till 2019 end since FY15.

The country has set a target to raise the capacity of installed renewable energy generation plants from the current level of 86.8 GW to 175 GW by the end of 2022. About 35 GW is under various stages of implementation and 32 GW under various stages of bidding. If the 45.7 GW of hydro and 6.8 GW of nuclear capacities are included, the target under the Paris climate change accord of having 40% of installed power generation capacity from non-fossil fuel sources can be achieved by 2022 itself.

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