In the last week of June, the tender received an overwhelming response from developers with bids for more than 4.3 GW of capacity
Three of the winners — Solarpack, ENEL, and IB Vogt — have no pipeline of solar projects and might have bid aggressive to build their portfolio
New Delhi: At a reverse auction conducted by SECI (Solar Energy Corporation of India) recently for a 2 GW solar tender under ISTS (Tranche IX), a historic low solar tariff of Rs 2.36/ kWh has been discovered. In the last week of June, the tender received an overwhelming response from developers with bids for more than 4.3 GW of capacity. The reverse auction of the tender, which was conducted after a gap of four months due to the COVID-19 lockdown, was conducted and it saw a historic low winning solar tariff of Rs 2.36/ kWh from SolarPack, a Spanish Developer, said JMK Research & Analytics.
The key trigger for this kind of low tariff is zero safeguard duty for developers and pass-through from BCD (Basic Custom duty) under “Change In-law” provision in this specific period. This is likely to significantly reduce project costs.
Access to low-cost financing can be key reason for aggressive solar tariff
Surprisingly, three of the winners — Solarpack, ENEL, and IB Vogt — have no pipeline of solar projects and might have bid aggressive to build their portfolio. AMP Solar also has a project pipeline of only 100 MW, plus a few other small projects under the Open access Corporate PPA route. EDEN, ReNew, and Ayana are the only ones with significant solar project portfolio.
Another interesting fact is that most of these winners are also international developers. Hence, access to low-cost financing can also be the key reason for such aggressive solar tariffs. “Clearly, there is no dearth of investment opportunities in the Indian solar market. And it will be very interesting to see the tender activity for the next 18 GW of RE projects where bid submission is expected before July 31,” said JMK Research and Analytics.
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