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India achieves historic low solar tariff of Rs 2.36 per kWh for 2-GW ISTS tender

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The Economic Times
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The Solar Energy Corporation of India (SECI) on Tuesday saw a historic low winning tariff of Rs 2.36 per kilowatt hour (kWh) from SolarPack, a Spanish developer, for its 2 gigawatt (GW) interstate transmission system (ISTS) solar PV project under tranche-IX, according to JMK Research. The major reason behind such low tariffs was zero safeguard duty for developers, access to low-cost financing, and a pass-through from basic custom duty under ‘change in law’ provision in this specific period, which is likely to significantly reduce project costs, it added. The winning developers -- Solarpack, ENEL, and IB Vogt -- have no pipeline of solar projects till now and might be aggressive to build their portfolio. AMP Solar has a project pipeline of only 100 MW along with some other small projects under the open access corporate PPA route. EDEN, ReNew, and Ayana were the only ones with a significant solar project portfolio. Last week, the tender received an overwhelming response from developers resulting in an over subscription by about 2.35 GW and got bids for a total of 4,350 MW solar capacity from 12 project developers such as ReNew Power, Tata Power, Azure Power, NTPC, NLC, SolarPack, and ENEL. SECI had floated the tender in March, however, due to COVID-19 lockdown its bid submission deadline got extended till June 22, 2020. This is the first major tender by SECI where bid submission is conducted after almost a gap of four months due to COVID-19. This has also been the first tender after the MNRE announcement of the removal of ceiling tariffs for wind and solar tenders. The minimum CUF condition for this tender was 17 per cent with a commissioning timeline of 18 months.

Author: Sustainability Outlook Desk
Industry Term: SECI solar energy