The sudden imposition of the safeguard duty on solar cell and module imports from China and Malaysia has caught the domestic project developers off-guard.

However, in a positive development for the developers, considering the imposition of 25 percent safeguard duty, the National Thermal Power Corporation (NTPC) has now provided bidders until August 13, 2018, to revise and resubmit their bids for the 2 GW interstate transmission system (ISTS)-connected solar photovoltaic (PV) tender.

When contacted, an NTPC official said, “The bidders had approached us after the levy of the safeguard duty, so we have provided them with time to resubmit their bids.”

NTPC’s 2 GW ISTS-connected solar PV tender was oversubscribed three times over. Bids amounting to 6,200 MW were submitted in response to the tender.

Speaking with Mercom, a source at one of the bidders for the NTPC tender said, “The NTPC has provided us with time until August 13, 2018, to resubmit bids. We cannot change the bid capacity or tariff but NTPC has allowed us to add the price we think will be incurred due to the safeguard. So now, the technical bid will have an extra component, the cost each developer thinks will be added on due to safeguard duty.”

When asked about how will this affect reverse bidding, the source explained, “Bidders will reverse bid on the initially submitted tariff plus the extra incurred cost due to safeguard duty as assessed by each bidder. The lowest bidder will then be selected.”

Mercom had recently reported that soon after the government announcement, the country’s leading project developers including Hero Future Energies, ACME Solar, and Vikram Solar filed petitions against the Director General (Safeguards) DG of Trade Remedies in the Orissa high court.

Before the duty was imposed, ACME Solar had received a stay order against the imposition of the safeguard duty from the same court.

Recently, the Ministry of New and Renewable Energy (MNRE) issued clarifications on the guidelines for the tariff-based competitive bidding process for grid-connected solar projects.

In its clarification notification, the MNRE stated, “Change in the rates of any taxes as mentioned in clause 5.7.2 of Guidelines for Tariff Based Competitive Bidding Process for Procurement of Power from Grid Connected Solar PV Power Projects, includes change in rates of taxes, duties and cess.”

In case a change in law results in any adverse financial loss or gain to the solar power generator, they will be entitled to compensation by the other party to ensure that the power generator is not adversely affected.

Image credit: MMEPL

The quote on reverse bidding in this article has been edited and updated