According to reports, the lowest financial bid for Tamil Nadu’s plan to set up 1000 mega watt of solar power, India’s single-biggest solar tender, has come in at Rs 5.97 per kilowatt hour, experts said. However, state utility Tamil Nadu Generation and Distribution Corporation Ltd will take a final decision on what will be a workable rate as the bid rate could be too low, they added.
The southern Indian state received bids for only a little less than 500 megawatts. The state has adopted the ‘L1’ method of bidding process, wherein bidders are asked to match the lowest bid.
Madhavan Nampoothiri, founder and director, of RESolve Energy Consultants said the lowest bid was from Mohan Breweries which had bid for 10 mega watt.
Out of the 500 mega watt, 40% of the capacity has been bid in Rs 7- Rs 8 range and only about 60 MW below Rs 7. Bids for about 75 MW are above Rs 10, while those for 141 MW are between Rs 8 and Rs 10.
“Not many developers may agree to build the project at a rate below Rs 7,” said Bharat BhushanAgrawal, solar analyst with Bloomberg New Energy Finance. “The 7-8 rupee range is not too low for the solar projects, especially for the developers who have other businesses where they can absorb the accelerated depreciation.”
The bids from most of the known names such as Sun Edison are in the range of Rs 7-Rs 8. Only Welspun and Waree have bid in the Rs 8.50 to Rs 9 range.
Power-starved Tamil Nadu is betting big on solar, with Chief Minister J Jayalalithaa drawing up an ambitious plan to add 3,000 MW through this route by 2015.