Grid-connected solar power project developers in Tamil Nadu are miffed over the utility not fully evacuating power, leading to loss of revenue, and inordinate delay in payments.

While the State boasts 1,150 MW of solar power generation capacity, and is targeting more additions to installed capacity, the ground reality is that a majority of installed capacity is being asked to back down – not feed to the grid, say developers who do not want to be named.

Payments for the power supplied are delayed a few months and this has affected bank repayments, they add.

‘Generation curtailment’

In a representations to the Union Ministry of New and Renewable Energy and to the Tamil Nadu Generation and Distribution Corporation, the Solar Power Developers Association has said they are facing 50 to 100 per cent “generation curtailment” during peak generation periods.

Evacuation approval and long-term power purchase agreements have been signed between the developers and Tangedco. Investments of about ₹ 6 crore per MW of generation capacity totalling over ₹ 6,000 crore have been made, but revenues are falling, they say.

More than 30 solar power developers have invested in Tamil Nadu in these utility scale projects, including large players such as the Adani group, Sun Edison, Malpani, Welspun and GRT. The feed-in tariffs range from ₹ 7.01 a unit for projects commissioned before March and ₹ 5.10 a unit for later projects.

Capacity addition plan

Ironically, sources say, the State government is planning for further addition of 500 MW of solar power generation capacity through the reverse bidding route.

“Unless existing developers are protected, how could the State hope to garner additional investments from serious players?” they ask. Such capacity additions involve investments up to ₹ 2,500 crore at prevailing project cost of about ₹ 5 crore a MW.

Industry sources said the State government has to assure grid availability for full off-take of power generated and prompt payments for serious developers to participate in reverse bidding.

They pointed out that the utility’s earlier attempt at reverse bidding route for about 1,000 MW of power had met with a lukewarm response and just about 150 MW of generation capacity was tied up, which too was subsequently scrapped.