Solar Energy Corporation of India (SECI) has conducted the auction for its tender for setting up 2,000 MW of grid-connected solar projects (Tranche-I) under the second phase of the Central Public Sector Undertaking (CPSU). The projects have been allocated through the viability gap funding (VGF) route.

Capacities have been awarded to NHDC (25 MW) which quoted the lowest VGF amount of ₹5.5 million ($77,793)/MW, Singareni Collieries (90 MW) quoted ₹6 million ($84,866)/MW, Assam Power Distribution Company Limited (30 MW) with ₹6.8 million ($96,181)/MW, Delhi Metro Rail Corporation (3 MW) with ₹6.975 million ($98,656)/MW, Nalanda University (5 MW) with ₹6.99 million ($98,947)/MW, and NTPC (769.4 MW) which quoted the highest VGF of ₹7 million ($99,010)/MW which also happened to be the maximum permissible limit.

The projects will be developed on Build-Own-Operate (B-O-O) basis. Under the program, the usage charges cannot exceed ₹3.50 (~$0.050)/kWh and will be exclusive of any other third-party charge such as wheeling, transmission charges and losses, and the likes.

SECI floated the tender to set up 2,000 MW of grid-connected solar PV projects under second phase of CPSU program in March 2019. The maximum permissible limit for VGF had been kept at ₹7 million (~$0.10 million)/MW for these projects.

In July 2019, SECI amended a provision in the tender and allowed for the inclusion of micro and mini grid-connected projects in the ambit of this tender. At that time, SECI also increased the project commissioning timeline from 18 months to two years.

In July 2019, Mercom also reported that five government entities submitted bids totaling 1,153 MW capacity for this tender, and the tender was undersubscribed by 847 MW. As the tender was undersubscribed, only 80% of the capacity bid for could be awarded in line with the tender condition. This means a maximum of 922.4 MW of grid-connected solar PV project capacity could only be awarded in this tender.

According to Mercom India Research, 4.5 GW of solar tenders have been issued under CPSU Phase II program from both SECI and NTPC.

Image credit: Suntech Power

Shaurya is a staff reporter at MercomIndia.com with experience working in the Indian solar energy industry for the past four years in various roles. Prior to joining Mercom, Shaurya worked with a renewable energy developer and a consulting company. Shaurya holds a Bachelors Degree in Business Management from Lancaster University in the United Kingdom.