Low tariff secured for NTPC’s 2 GW solar auction

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During Tuesday’s auction, Acme Solar, Shapoorji Pallonji Infrastructure and Azure Power quoted the lowest tariff of Rs. 2.59, followed by SB Energy, with Rs. 2.60 ($0.0373) per unit.

Overall, Acme Solar – which recently said it would quit its PV pipeline unless safeguard tariffs were passed onto utilities – was awarded 600 MW, while Shapoorji Pallonji Infrastructure received 500 MW, and Azure Power, 300 MW.

SB Energy, a joint venture of SoftBank, Foxconn and Bharti Airtel, placed a bid for 2 GW of capacity, but was awarded just 600 MW in the end.

The highest winning bid was submitted by Nisagra Renewable, at Rs. 3.10 ($0.0445) for 150 MW. This is 19.69% higher than the lowest tariff. ReNew Solar, meanwhile, was awarded 500 MW at Rs. 3.09 ($0.0443).

The winning tariffs for this project are lower than the Rs. 2.71 ($0.0445) tariff reached during NTPC’s 750 MW auction, held this May. They are well above the record-low solar price of Rs. 2.44 ($0.0346) per unit, however, reached at the Bhadla Solar Park (Rajasthan) auction held in May 2017.

NTPC issued the 2 GW tender in March 2018. It was oversubscribed by three times, with bids amounting to 6.2 GW submitted. Following the imposition of 25% safeguard duty on July 30, the company delayed the auction by a week, giving bidders time until August 13, 2018, to revise and resubmit their bids.

NTPC’s relative success is attributed to its excellent financials and reputation for guaranteeing off-take and timely payments, unlike many state utilities.

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