Solar tenders, auctions see steep decline in November: Mercom

Virendra Pandit Ahmedabad | Updated on January 09, 2018 Published on December 13, 2017


Solar tenders and auctions saw a steep decline in India last month, according to a Mercom Research study.

The solar capacity tendered in November fell 25 per cent from the previous month to 300 MW, while the amount of solar auctioned dropped 98 per cent to just 5 MW.

“Hopefully, tender and auction activity has bottomed out. The GST issue is almost behind us and the government is asking discoms (distribution companies) to refrain from PPA (power purchase agreements) renegotiations, though an anti-dumping case is still looming,” said Raj Prabhu, CEO of Mercom Capital Group.

Read: Written submissions to follow in solar anti-dumping case

The largest tender last month was issued by Karnataka Renewable Energy Development Ltd, which re-tendered 200 MW of solar energy to be developed at the Pavagada Solar Park in Tumkur district.

Solar Energy Corporation of India (SECI) held the only auction last month, when it auctioned a 5 MW grid-connected solar PV project under the National Solar Mission Defence viability gap funding (VGF) programme for the Ordnance Factory in Kanpur. Giriraj Renewables Pvt Ltd emerged as the successful bidder, quoting a tariff of ₹4/kWh without VGF.

According to Mercom’s India Solar Project Tracker, cumulative solar installations surpassed 17 GW as of September 2017, with over 7 GW installed in the first nine months.

In August, Mercom reported that the Ministry of Power had issued final guidelines for tariff-based competitive bidding process for solar projects. The guidelines address some of the challenges faced by large-scale project developers and aim to replicate the success of the Rewa auction by including payment guarantees, longer construction timelines for large projects, and deemed generation benefits. Also included in the guidelines was a provision for an intermediary procurer and clarity on the change in law clause.

Following the recent lull in tender activity, the Union Ministry of New and Renewable Energy (MNRE) revealed that it is preparing to announce a number of tenders for solar projects over four months starting December 2017. The tenders aim to help the government reach its goal of installing 100 GW of solar capacity by 2022.

Under the plan, MNRE will work alongside States to announce tenders needed to reach 20 GW of ground-mounted capacity in solar parks in FY18. Of this, 3.6 GW has already been tendered while another 3 GW was to be tendered in December, followed by 3 GW, 5 GW and 6 GW in the subsequent months. Another 30 GW is expected to be tendered in FY19, followed by 30 GW in FY20.

According to Mercom’s Q3 2017 India Solar Market Update, 1,456 MW was tendered and 1,232 MW was auctioned in the period. That represented a marked reduction from 3,408 MW and 2,505 MW, respectively, in Q2 2017.

Published on December 13, 2017
This article is closed for comments.
Please Email the Editor