Adani Green Energy, the renewables arm of Adani Enterprises, has completed the signing of a power purchase agreement (PPA) for the entire 8 GW of solar capacity with the Solar Energy Corporation of India (SECI) under the manufacturing-linked solar project development tender.

The company won the auction to develop 8 GW in January 2020, which it claims to be the world’s largest solar tender to date.

Under the tender, Adani Green recently executed the PPA to supply 1,799 MW of solar power for 25 years to SECI, in addition to the 6,201 MW PPAs signed in 2021 and 2022.

The company also committed to manufacture 2 GW of solar cell and module capacity under the tender. In August this year, the company’s step-down subsidiary, Mundra Solar Energy, received the commercial operational date certificate from SECI for the 2 GW solar cells and modules manufacturing facility in Gujarat.

Background

SECI floated the tender in June 2019 for a total of 12 GW of solar power supply and 3 GW of solar cell and module manufacturing capacity (including the greenshoe option). Out of this, Azure Power was allotted 4 GW of solar project development and 1 GW of manufacturing capacity, with the remaining awarded to Adani.

According to an update by SECI, Azure has signed PPAs for a total of 3,033 MW out of the total allocated capacity so far.

The solar projects auctioned in 2020 faced a unique challenge due to its high tariff at ₹2.92 (~$0.0351)/kWh and the high capacity and could not find off-takers among the distribution companies (DISCOMs).

It was stipulated in the bid that PPAs will be signed for four packages – Package I to IV, each package being 1/4th of the awarded solar project capacity, i.e., 3 GW.

SECI later agreed to pool the tariff for these packages with other lower tariffs discovered in subsequent auctions to ensure DISCOMs find these rates attractive enough to sign power sale agreements.

For Package I, SECI signed PSAs with GRIDCO (500 MW), Chhattisgarh State Power Distribution Company (300 MW), Tamil Nadu Generation and Distribution Corporation (1,000 MW), Jammu Kashmir Power Development Corporation (100 MW), Brihanmumbai Electric Supply and Transport (234 MW), and Tripura State Electricity Corporation (100 MW) at ₹2.54 (~$0.0305)/kWh plus a trading margin of ₹0.07 (~$0.00084)/kWh. Out of the 3,000 MW under Package I, Adani Green was to supply 2,000 MW and Azure Power 1,000 MW.

Andhra Pradesh thereafter signed power sale agreements (PSA) with SECI for a total of 7 GW capacity under Package II to IV at ₹2.42 (~$0.0291)/kWh and a trading margin of ₹0.07 (~$0.00084)/kWh.

Adani now has a total of 19.8 GW of solar capacity under PPAs and 800 MW as merchant capacity.

Amit Singh, CEO, Adani Green Energy, said, “We are glad to conclude the largest green PPA and enable a sustainable energy landscape. Aligned to India’s target of 500 GW non-fossil fuel capacity by 2030, Adani Green is determined to deliver in excess of 45 GW renewable energy, a five-fold increase from our current operating portfolio. This reaffirms our resolve to provide affordable and accessible clean energy.”

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