Solar tariffs have fallen to an unprecedented low of Rs. 4.34 a kWhr. Finnish company, Fortum Finnsurya Energy, quoted that tariff to bag the mandate to set up a 70 MW solar plant under NTPC’s Bhadla Solar Park tender.
NTPC bid out 420 MW, in six blocks of 70 MW each. The other winners were Rising Sun Energy Pvt Ltd (two blocks for Rs. 4.35 a kWhr), Solairedirect (two blocks for Rs. 4.35) and Yarrow Infrastructure (one block for Rs. 4.36).
Thirteen of the 22 bidders quoted tariffs less than Rs. 5, with the bidder ranked 13, Suraksha Realty, quoting Rs. 4.89.
ACME Solar and Hero Future Energy, which quoted Rs. 4.40 and Rs. 4.44 respectively, came closest to the winning bids.
In November, American renewable energy giant, SunEdison, made news winning solar projects in Andhra Pradesh offering to sell power at Rs. 4.63 a kWhr, a new low then. In the next month, a joint venture of the Japanese telecom giant, Softbank, and India’s Bharti group, secured solar projects in the same state, also quoting a tariff of Rs. 4.63.
Industry experts then criticised the bids as irrational exuberance and said the tariffs were unviable and bound to mess up the market. But now, the new low of Rs. 4.34 has left many flabbergasted.
“The industry is filled with idiots,” fulminated an official of a solar EPC company, who requested not to be named, as the news of the winning bidders broke late Monday night.
Also dismayed over the happenings is the wind industry, which sees its market being eaten into by solar, as renewable-energy-minded state governments have been showing a marked preference for solar over wind, due to falling tariffs.
“We understand that we are amongst the successful bidders in the e-reverse auction process conducted by NTPC for the ‘Selection of grid connected Solar PV projects under batch II tranche I of NSM phase II state specific bundling scheme in Bhadla Solar Park Phase II in Rajasthan for 70 MW’. However, based on the general procedure, Letter of Intent (LoI) shall be issued within 15 days from the completion of the reverse auction process and PPA shall be signed within 30 days after the LoI is issued,” said Sanjay Aggarwal, Managing Director Fortum India, in a statement today.
Source: The Hindu