India has set another new low benchmark for solar power tariffs, with French firm Solairedirect (now incorporated in the Engie Solar division) securing a 250 MW tender in Andhra Pradesh with a winning bid of INR 3.15/kWh ($0.0486/kWh).
The project was tendered by India’s National Thermal Power Corporation (NTPC) at the Kadapa Solar Park, reports Mercom Capital Group, and will have a 13-month completion timeframe from the date at which the power purchase agreement (PPA) is signed.
This record low price was confirmed by Indian energy minister Piyush Goyal, who tweeted: “Clean affordable power for all: solar achieves another record low of INR 3.15/unit (flat rate) during auction in Kadapa, AP by NTPC.”
An NTPC official expressed surprise at the low tenders, stating that they were expecting prices closer to INR 3.50 ($0.054)/kWh. Instead, Solairedirect’s bid led a competitive field that also included tariffs below the INR 4 mark lodged by Canadian Solar and Ostro Energy. The highest tariff – lodged by Mahindra Renewable Private Limited – was INR 4.68 ($0.0723)/kWh.
Mercom Capital Group said that this tender is an accurate indicator that future auctions in Andhra Pradesh and India as a whole are now likely to be in the $0.054/kWh range.
The previous national record was set only recently at Madhya Pradesh’s Rewa auction in February. Then, a tariff of INR 3.30 ($0.0494)/kWh turned heads, with Mercom Capital CEO Raj Prabhu warning against this price being seen as a new normal for Indian solar.
This latest lowering of the price floor came via a French firm that has 182 MW of solar projects in India at various stages of operation and construction.
The solar capacity tendered at the Kadapa Solar Park under India’s National Solar Mission was actually part of a tranche of re-tendered projects that had initially been scrapped by the NTPC due to ongoing delays.