Consulting firm Bridge to India has termed the recent low winning bids for solar power projects in India “unsustainable” and waConsulting firm Bridge to India
India solar power generation capacity that stood at 2,650 MW on May 26, 2014, crossed the 10,000 MW mark on March 11, registering a three time increase in less than three years.
Solar tariffs fell to record lows last month when major players, including foreign firms, won separate contracts for building a 750 MW solar park in Rewa, Madhya Pradesh, with bids to supply power at less than Rs 3 per unit.
India is working on a plan for making domestic manufacturing of solar power generation equipment competitive vis-à-vis other countries such as China.
The three companies submitted the lowest bids from a lot of 20 bidders, both national and international, who had initially submitted their proposals to develop the Rewa solar park in Madhya Pradesh. The bids had closed on January 23.
The reverse bidding process for the Rewa solar park in Madhya Pradesh saw record first year low tariffs by the bidding companies. While Mahindra emerged the successful bidder for Unit-1 and submitted the lowest first year tariff at Rs 2.979 a unit, Acme Solar bid further low for the second unit of Rewa at Rs 2.970 a unit and Solenberg bid the lowest first year tariff of Rs 2.974 for the third unit of Rewa.
The record low bids for solar power projects in the country may not be a threat to the sector after all. According to a report by Institute of Energy Economics and Financial Analysis (IEEFA)