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The solar power tariff has hit a new low of Rs 2.62 per unit in the auction for a 250 megawatt capacity project in Bhadla park in Rajasthan.
This is lower than the last lowest bid of Rs 3.15 per unit recorded in a 250 mw solar park bid offered in the Kadapa solar park in Andhra Pradesh by Solairedirect of France.
According to information available, Phelan Energy Group of South Africa and Avaada Power have bid for Rs 2.62 per unit (kilowatt hour) to bag mandate to develop 50 mw and 100 mw respectively and SBG Cleantech, a consortium of Softbank Group, Airtel and Foxconn offering Rs 2.63 per unit for 100 mw at Bhadla park in Rajasthan.
Business Line had recently reported that the Bhadla park bids could see the tariff offer breaching Rs 3 per unit mark.
Power Minister Piyush Goyal tweeted, “Another milestone towards PM@narendramodi's vision of clean affordable power for all: Bhadla solar park achieves tariff of Rs 2.62 per unit.”
This project has been awarded based on reverse auction where Solar Energy Corporation of India had set a reserve price of Rs 3.01 per unit for 500 mw capacity being bid.
The tariff offer has been steadily coming down over the past six-seven years but it has been quite steep in the last 15-18 months.
While in November 2015 Sun Edison had bid at Rs 4.63 per unit for 500 mw at Kurnool solar park, this was down to Rs 4.34 per unit at NTPC Bhadla solar park last year.
This low was again breached at the Rewa solar park tender with an offer of Rs 2.97 per unit in Madhya Pradesh with the levelised tariff working at about Rs 3.30 per unit.
According to sector watchers, the drop in price of bids has been mainly due to latent demand to bag projects with assured returns and no hassle of land acquisition. This has been well aided by steep drop in prices of modules due to huge capacity build up in China in particular.
The Power Ministry proposal to bundle some of the renewable energy plants with fossil fuel plants could also be a major game changer for the sector.
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