Finance, Other, solar

Tangedco to come out with another tender for solar power

According to reports, Tamilnadu Generation and Distribution Company (Tangedco) will come out with another tender for purchase of solar power soon, a senior official of the company told Business Line today.

The price bids of the current tender will be opened on January 30, he said.

Tangedco recently came out with a tender for the purchase of power generated from solar power plants of total capacity of 1,000 MW. Bids were opened on January 4, and the total bids had amounted to less than 500 MW of capacity.

Now after the price bids are opened, negotiations will take place. Tangedco will first negotiate a price with the bidder who has quoted the least price (L-1), and then ask other bidders to match that price.

After the entire process is over, there will be another tender for the rest of the proposed capacity, the official said. For instance, if the process results in the creation of only 300 MW, the new bid could be for 700 MW, he said.

Enquiries by Business Line show that several bidders have quoted prices between Rs 7 and Rs 8. They quoted a price higher than what they can afford to sell, knowing they could always agree for a lower price at the negotiations.

One developer, who did not want to be named, said that his calculations showed that with the ‘accelerated depreciation’ benefit, he could profitably sell solar power at Rs 6.50 a unit.

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