The Finnish firm that rattled the Indian solar power industry by making a record-low power supply bid at an NTPC auction in January says it put in six months to a year’s work behind its bid and that it is very comfortable with the quoted tariff. While some industry executives doubt the viability of the bid by Fortum India, the local arm of Fortum Oyj, its managing director Sanjay Aggarwal tells ET’s Kaavya Chandrasekaran in an interview that there was a scientific basis to the bid. Edited excerpts:
Many expressed doubts about the viability of Fortum’s bid of Rs 4.34 per kwH. Why and how did you decide to bid so aggressively?
That particular tariff was for a specific plant. It is not that the same tariff will be applicable all over the country. Just as radiation levels are not the same across the country, just as the land costs, power evacuation issues are not the same, the tariff will not be the same. Bhadla (in Rajasthan) happens to be one of the regions where radiation is the highest. That plays an important role. There is a huge amount of work that has gone on for the last six months to a year behind the tariff we quoted. This is a tariff with which we feel comfortable.
Financing was a big hurdle for solar developers in India until recently. To what extent has the situation eased?
As long as there are strong promoters of a project, as long as a project is viable, I don’t think there is dearth of money in the system. All the bankers need is a strong, reliable and safe promoter. At the end of the day, every bank wants to make money. If a promoter is sound, has execution capability, has proven time and again that he can manage projects, bankers will not have any issue.