SECI’s CPSU Tender for 2 GW of Solar Projects Left Undersubscribed by 932 MW

The Solar Energy Corporation of India (SECI)’s tender for setting up 2,000 MW of grid-connected solar photovoltaic (PV) power projects (Tranche-I) under the second phase of the Central Public Sector Undertaking (CPSU) program has been undersubscribed by 932 MW. The projects will be developed on Build-Own-Operate (B-O-O) basis.

A total of five government entities submitted bids totaling 1,068 MW capacity. A SECI official confirmed the closure of the submission of technical bids and informed that the tender had been undersubscribed. The official, however, did not provide any reason for the undersubscription of this tender.

According to a market source, “The National Thermal Power Corporation (NTPC) has submitted its bid to set up 1,000 MW of grid-connected solar PV projects, Assam Distribution, and NHDC, (a joint venture between NHPC and Madhya Pradesh State Government), each bid to develop 30 MW of grid-connected solar PV capacity. Nalanda University submitted bids to set up 5 MW of projects while Delhi Metro Rail Corporation (DMRC) bid to set up 3 MW.”

As the tender has been undersubscribed, 80% of the capacity bid for will be awarded in line with the ministry norms. This means a maximum of 854 MW of grid-connected solar PV project capacity will be awarded in this tender. In such a scenario, if the NTPC quotes the lowest tariff, no other bidder will be able to win the auction.

The tender to set up 2,000 MW of grid-connected solar PV projects under second phase of CPSU program was floated by SECI in March 2019.

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 the last few months, quite a few of SECI’s tender have been left undersubscribed, indicating poor interest from the developers.

In May 2019, for instance, the tender issued by SECI to set up 1,200 MW of ISTS-connected solar-wind hybrid power projects (tranche-II) was left undersubscribed by 300 MW.

Before this, its tender for 1,200 MW of ISTS-connected wind power projects on a pan-India basis under tranche-VII has been undersubscribed by 50%.