The National Thermal Power Corporation (NTPC) has annulled a 250 MW Domestic Content Requirement (DCR) category auction, which was held in October 2017.

A senior NTPC official confirmed the annulment of the DCR tender saying, “The tender had to be cancelled due to the World Trade Organization (WTO) regulations.”

Elaborating on the issue, the NTPC official said, “The power generated from this project was meant for the New Delhi Municipal Corporation (NDMC). According to the WTO regulations and the decision made by the United States and India, the DCR category ended on December 14, 2017. This project would have come into existence soon afterwards, and thus would have been in conflict with the WTO norms.”

Had the project been tendered for captive consumption and was not under the developer mode, there would have been no need for an annulment,  added the NTPC official.

When approached for a comment on the development, Azure Power executives chose to remain silent.

The NTPC had tendered the capacity in August 2017, hoping the project would be developed quickly. Another NTPC official had then told Mercom, “There’s an off-taker on board, this project will be developed quickly as most ends have been tied up.”

In October 2017, Azure Power emerged as the lowest (L1) bidder by quoting a tariff of ₹3.14 (~$0.0491)/kWh to develop the 250 MW of solar project under the DCR.

When asked whether the capacity will be tendered again, the NTPC official said, “Right now, I cannot comment on that. We (NTPC) will have to rejig the tender guidelines etc., All of it is definitely going to take some time. So, let’s take it one step at a time”.

This tender cancellation raises concerns about whether all the implementing agencies in the country are aware of the new rules applicable to the solar sector.

The legal war of words between India and the United States on the issue of supply of Domestic Content Requirement (DCR) is still ongoing. A month after the U.S. argued that India did not abide by the solar policy norms prescribed by the World Trade Organization (WTO), India has now rejected the accusation, calling it ‘groundless’.

Image credit: Azure Power

Correction: Removed an out of context sentence from the 9th paragraph.