Solar Energy Corporation Of India (SECI) has issued an RFS for selection of bidders for its latest 1200 MW solar tender. Developers can bid on a minimum capacity of 50 MW and a maximum capacity of 300 MW. Project capacity will be in the multiples of 10 MW. The minimum Capacity Utilization Factor (CUF) that a developer can declare in the solar tender cannot be less than 17%. The project can be installed at any location across India.
Reason for a lower-upper cap on the tariff in SECI solar tender
SECI- the nodal agency responsible for developing renewable energy projects for the central government- has capped the maximum solar tariff to INR 2.78 per unit. The upper cap on solar tariff is considerably lesser than state projects as seen lately in the currently open solar tenders of Maharashtra and Bihar. The ceiling on the tariffs in these states is INR 3.30 and INR 3.15 per unit respectively. Developers have a higher appetite for risk in a central government’s tender in comparison to state tenders.
The same is also evident from the lowest tariff trends in various solar tenders during 2018-19
Wherever the tariffs are under INR 3 the nodal agency for the solar tender fall under the central government.
Location of a project also plays a critical factor. Since the scope of work also includes the identification of land for setting up the project, developers will choose the best location for maximum energy generation and maintain their declared CUF.
By far the lowest solar energy tariff discovered in any bid is INR 2.44. The tariff has been discovered in at least three different solar tenders. The ceiling tariffs in those bids were in the range of INR 3.50-3.60 per unit. After the GOI imposed safeguard duty on solar panels the ceiling tariff would hover in the range of INR 2.90-3 per unit. It is after a while that any solar tender has a comparatively lower ceiling tariff. But still, it is unlikely that the solar tariff will touch the lowest. A lot will also depend on the bidders’ participation.
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