Lowest Tariff of ₹2.83/kWh Emerges in SECI’s Wind Auction for 440 MW

The Solar Energy Corporation of India (SECI) has awarded 439.8 MW of wind projects in its latest auction. This capacity is part of the tender floated by the agency for 1,800 MW of interstate transmission system (ISTS) connected wind projects under tranche VIII.

The auction saw the lowest tariff of ₹2.83 (~$0.0395)/kWh quoted by CLP India which bid for a capacity of 250.8 MW. The other bidder Avikaran Energy (Enel) quoted a tariff of ₹2.84 (~$0.0396)/kWh to develop a capacity of 300 MW but will only be awarded 189 MW.

Together, the two bidders have been allotted 439.8 MW of wind projects.

SECI had tendered the capacity in June 2019 with a tariff cap of ₹2.85 (~$0.041)/kWh.  A few days ago, Mercom reported that the tender was left undersubscribed by 1,249 MW. As the tender was undersubscribed, only 80% of the bid capacity could be awarded in line with the ministry norms. Therefore, only a capacity of 439.8 MW has been awarded.



SECI 1,800 MW ISTS Wind Projects

The lowest tariff discovered in this auction is ₹ 0.04 (~$ 0.00056)/kWh more than that discovered in SECI’s previous wind auction held in May 2019.

India: Lowest Wind Tariff Discovered

Off late, many of the tenders floated by SECI have been left undersubscribed.

In February, SECI’s had tendered another 1,200 MW of ISTS-connected wind energy-based projects under tranche-VII with a tariff cap of ₹2.83 (~$0.0401781)/kWh, which witnessed similar results during the auction process. This tender had been undersubscribed by 50%. The auction was held only for 480 MW which received tariffs ranging from ₹2.79 (~$0.0396)/kWh to ₹2.83 (~$0.0401)/kWh. Winners of this auction included, Engie, ReNew Power, Sprng Energy and Adani.

According to Mercom India Research, SECI has auctioned ~9.3 GW of wind projects under ISTS (Tranche I to Tranche VIII).

Mercom has been reporting on how the tariff caps are slowing down auction activity in India. Developers have become reluctant to bid at the levels prescribed by state agencies instead of a market-based auction where the lowest bid wins. This has caused several developers to refrain from participating in these auctions, and several auctions have been undersubscribed recently.