First Solar India, the Indian subsidiary of world’s largest solar panel manufacturer First Solar, plans to participate in India’s first inter-state transmission system (ISTS) bids for projects being invited by Solar Energy Corporation of India (SECI) and National Thermal Power Corporation (NTPC).
The ISTS-based bidding is unique in the sense that the developer will have to mandatorily build the electricity transmission lines to the nearest PGCIL grid network from the project site of its choice. It is expected that SECI will invite bids for around 5,000 megawatts (MW) of ISTS linked to solar power capacities by the end of April or first week of May. While NTPC has already floated a tender for about 2,000 MW, the process has got delayed —the pre-bid meeting scheduled for March 20 has been postponed.
Under ISTS, the developer gets the choice of project and location anywhere in India. The minimum bid under the tender is for 50MW, but a developer may bid for the entire capacity on offer.
Sujoy Ghosh, India head of First Solar, told FE that the company plans to bid for these projects and they are waiting for the pre-bid meetings. “The exclusivity of ISTS-based bidding is the choice of location and the project. Also, the bid size has to be more than 250MW if it has to be connected to 300 KVA lines of PGCIL,” Ghosh said. “The voltage at the panel level is low, which needs to be stepped up through a pooling substation. It needs to be developed by the developer and would imply a higher cost,” he added.
For the tenders floated in March, NTPC will enter into power purchase agreements (PPAs) with the selected project developers, either directly or through its trading arm. Bids for national tenders will be costly compared with solar parks as the developer will have to look for the project sites or use their own land bank. However, the security of signing PPAs with a government-owned company like NTPC and SECI will boost confidence.
First Solar has two lines of business in India — it sells solar panels and develops solar power projects. The company has supplied solar panels for 2,000MW of installed capacity in India (including 250MW of its own), which is 10% of India’s total 20,000MW solar capacity.
In July 2017, the company sold about 190MW of its solar power assets to IDFC Alternatives. It will look at selling the remaining 60MW by the end of 2018 or early 2019, once the one-year lock-in period as an equity investor is over, Ghosh said.