A 1,200 MW solar tender issued by the Solar Energy Corporation of India (SECI) has been postponed for the third time due to lack of interest from developers.
SECI is the arm of the renewable energy ministry through which it conducts wind and solar auctions. Despite having made amendments to the tender, participation was abysmal. Following the third postponement, SECI also increased the ceiling tariff to Rs. 2.68 per unit from Rs. 2.65.
A senior ministry official confirmed the development.
But experts do not believe that even the latest reduction will attract bidders. “The ceiling tariff in the current market is not attractive," said Vinay Rustagi, managing director at renewable energy consultancy Bridge To India.
The auction has been postponed to September 16.
"The industry is clearly sending a message to the ministry that setting ceiling tariffs are not acceptable to us," said a developer.
Substations for transmitting the power have been identified in Madhya Pradesh but projects can be built anywhere in the country.
Under-subscription of tenders has become a pattern of late. Two auctions conducted by SECI earlier this month received two responses each. The number of bidders in the renewable energy market has fallen from more than 200 in 2015 to only 31 in 2019, noted Bridge To India in its latest report.
"There are many reasons for falling investor interest—increasing cost and risks associated with land acquisition plus transmission, tightening liquidity in the financial markets, and aggressive ceiling tariffs," it said.
Andhra Pradesh's recent attempts to renegotiate signed PPAs, both wind and solar, has also led to more frustration and uncertainty amongst developers.
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