The National Thermal Power Corporation (NTPC) emerged as the lowest (L1) bidder in the auction conducted by the Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA) for 550 MW of grid-connected solar projects. Looking back at the past few auctions in the state, there has been a decrease of 4.7 percent in solar tariffs quoted in successive auctions.

A UPNEDA official confirmed that the reverse auction for 550 MW of solar projects has ended and that NTPC quoted a tariff of ₹3.02 (~$0.0431)/kWh to develop 85 MW of grid-connected solar PV projects, EDF (Bastille Solar) quoted a tariff of ₹3.04 (~$0.0434)/kWh to develop 70 MW of solar, and it also quoted a tariff of ₹3.07 (~$0.0439)/kWh to develop another 70 MW.

“Avaada (Giriraj Renewables) quoted ₹3.07 (~$0.0439)/kWh to develop 100 MW, Jakson Power bid ₹3.07 (~$0.0439)/kWh to develop 50, Adani (Mahoba Solar) bid ₹3.07 (~$0.0439)/kWh to develop 50 MW, Tata Power Renewable Energy Limited (TPREL) quoted ₹3.07 (~$0.0439)/kWh to develop 50 MW and ₹3.08 (~$0.0440)/kWh to develop another 50 MW,” said the UPNEDA official.

The official added that Adani (Mahoba Solar) also bid ₹3.08 (~$0.0440)/kWh to develop another 50 MW, but will be awarded only 25 MW, due to the restrictions posed by the bucket filling order followed in awarding capacities in reverse bidding.

“The tariffs are good, and the letters of award will be issued soon. We are satisfied with these tariffs and overall these tariffs represent a huge decrease in cost of solar power in the state of Uttar Pradesh. If we compare it to our 500 MW solar auction that recently concluded, the lowest tariff was ₹3.17 (~$0.04558)/kWh. Now, it has come to ₹3.02 (~$0.0431)/kWh. This shows that the investor interest has increased in the state as developers are willing to go down to these prices. Uttar Pradesh is changing,” the official told Mercom.

He further added, “Firms who won in the 500 MW auction are also the winners in this one. Developers now know that getting LoAs and LoIs is not so cumbersome anymore in Uttar Pradesh, as due process is being followed and this has benefited us as the implementing agency. Now, the sole focus is on the 200 MW solar park tender in the state.”

Solar tariffs quoted by project developers have remained firmly above the ₹3 (~$0.040)/kWh mark in Uttar Pradesh and this auction ascertains the fact that developers think going below ₹3 (~$0.040)/kWh /kWh mark is a risk in the state. In the recently concluded 500 MW solar PV auction by UPNEDA, L1 tariff of ₹3.17 (~$0.04558)/kWh was quoted. Maheshwari Mining and Energy and NTPC Limited (RE) quoted the lowest tariff of ₹3.17 (~$0.04558)/kWh to develop 20 MW and 140 MW respectively.

When contacted, an NTPC official confirmed the culmination of the auction and said, “We (NTPC) have land available in the state hence we are participating and winning in these auctions. Sometimes, the margin can be large (the previous, 500 MW auction) and sometimes it can be small. The NTPC will soon issue engineering procurement construction (EPC) contracts for these capacities.

Per Mercom’s India Solar Project Tracker,  for this auction Adani had bid for the largest capacity of 250 MW (5*50 MW), EDF had bid for 140 MW (2*70 MW), Tata Power Solar bid for 100 MW (2*50 MW), Avaada Power (Giriraj Renewables) bid for 100 MW, NTPC for 85 MW, Sukhbir Agro and Jakson each bid for 50 MW, and Vijay Printing Press bid for 20 MW.

UPNEDA had fixed ₹3.10 (~$0.04458)/kWh as the upper tariff ceiling for this tender and this helped evince the desired response from developers.

Mercom previously reported that eight bidders submitted bids aggregating 795 MW in response to UPNEDA’s 550 MW solar PV tender.