The Lowest (L1) tariff of ₹2.79 (~$0.0406 )/kWh was quoted in the recent solar auction held by the Grid Corporation of Odisha (GRIDCO) for the development of 200 MW of grid-connected solar photovoltaic (PV) auction in the state.

The tender was oversubscribed by almost four times. The capacity was tendered by GRIDCO in April 2018.

“Barring the L1 bidder, all other participants quoted tariffs above ₹3 (~$0.0437)/kWh”, an official at GRIDCO told Mercom.

“Aditya Birla Renewables quoted ₹2.79 (~$0.0406)/kWh to develop 75 MW of solar PV capacity. Sukhbir Agro bid ₹3.19 (~$0.0464)/kWh to develop 25 MW, Gupta Power quoted the same tariff to develop 20 MW. Even Eden Renewables quoted ₹3.19 (~$0.0464)/kWh to develop 50 MW. ACME Solar quoted a tariff of ₹3.20 (~$0.0466)/kWh to develop 50 MW,” added the GRIDCO official.

This was the first tender that was introduced with a pass-through option back when there were uncertainties surrounding the imposition of safeguard duty.

When asked if the tariff was quoted considering the recent imposition of safeguard duty, Ravi Khanna, the CEO of Aditya Birla Solar said, “We haven’t factored in safeguard duty in our quoted tariff. We haven’t reduced even a single paisa in the tariff initially quoted by us in this auction. Our bid is commensurate to the conditions prevalent at the time we submitted the bid. We cannot factor in speculation. At that time safeguard duty case was on, there was no surety whether it will be levied or not”.

In all, 14 bidders submitted technical bids aggregating 845 MW. Out of the 14, 12 participated in the financial bidding, informed the GRIDCO official.

The capacities will be awarded in bucket filling order. Therefore, ACME stands a chance of being awarded only 30 MW.

It is being observed that auctions resulting in high tariffs have the risk of being withdraw and retendered. Recently, Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA) cancelled the auction for the development of 1 GW of grid-connected solar PV projects across Uttar Pradesh, citing high tariffs quoted by developers and retendered 500 MW.

In India, ₹2.44 (~$0.0355)/kWh is the record low tariff, and now off-takers are reluctant to purchase solar power closer of above the ₹3 (~$0.0437)/kWh mark.

This article has been updated with a quote from the CEO of Aditya Birla Solar