United Kingdom-based investor firm Downing has successfully commissioned 20 MW of open access solar projects in the southern states of Telangana and Andhra Pradesh.
Downing is working in collaboration with its Hyderabad-based investment partner Armstrong Energy Global for the operation of these two solar projects in India.
The projects comprise a combined total funding of £13.5 million (~$19,317,217) from the Downing Indian Solar Enterprise Investment Scheme (EIS) and other Downing-managed funds.
The two solar projects are the first two investments made by the EIS in 2015 and 2016 respectively.
The EIS, backed by UK retail investors, is investing a total of £12 million (~$17,169,840) in solar projects across India.
Downing Indian Solar EIS and Downing-managed Venture Capital Trusts (VCTs) provided £7.2 million (~$10,301,904) of funding to the Special Purpose Vehicle (SPV) SF Renewables, to support the construction of the 11.2 MW Kambadur solar project in Andhra Pradesh.
Moreover, Downing Indian Solar EIS, Downing Estate Planning Service, and Downing-managed VCTs also invested £6.25 million (~$8,944,375) in the SPV Rockhopper Renewables, for the construction of the 8.4 MW Jogipet solar project in Telangana, northwest of the capital city of Hyderabad.
The power generated by both these projects will be sold through open access Power Purchase Agreements (PPAs) to commercial and industrial customers.
According to a media statement issued by Downing, the development of another 22 MW of solar projects, with support from Downing-managed funds, is underway in the state of Maharashtra.
Jonathan Selwyn, the chairman of Downing Indian Solar EIS commented on the development saying, “The Indian solar market is growing rapidly and naturally holds huge potential for investors due to the tropical climate in areas such as the south. However, as a relatively new market, it is not without its challenges. It is therefore a testament to the Downing and Armstrong teams that these challenges have been successfully overcome, that the projects have been commissioned on time and are already generating significant amounts of power.”
In December 2017, the Forum of Regulators (FOR) released a report on the issues affecting open access in the country and charted a way forward for the better implementation of open access in India. The working group identified the tariff and non-tariff barriers for open access, the impact of open access on revenue of distribution companies (DISCOMs), carried out a detailed examination of the rules for captive generation, their impact on open access, and has also provided suitable measures for the implementation of open access.
States are slowly making open access more cumbersome to avoid losing future revenues. In 2017, Telangana DISCOMs petitioned Telangana State Electricity Regulatory Commission for a surcharge of ₹1.95 (~$0.03)/kVAh on open access consumers for 2017-18.
Assam has also proposed draft rules which would require open access consumers to pay transmission and wheeling charges.
Image credit: Downing
Ankita is an editor at MercomIndia.com where she writes and edits clean energy news stories and features. With years of experience in the news business, Ankita has a nose for news and an eye for detail. Prior to Mercom, Ankita was associated with The Times of India as a copy editor for the organization’s digital news desk. She holds a Bachelor’s degree in Psychology from Delhi University and a Postgraduate Diploma in journalism. More articles from Ankita Rajeshwari.