The installed solar power capacity in Odisha is 93 Mw but the state sources about 75 Mw from outside
Barely two weeks into the maiden solar power auctions in Odisha, the state-owned bulk power trader, Gridco, is dithering on signing power purchase agreements (PPAs) with the successful bidders.
Auctions for solar power of 200 Mw capacity in Odisha got an encouraging response at a time when developers were rattled by announcement of safeguard duty on solar equipment imports from China and Malaysia. But, for Gridco, the vexing issue is the wide difference between L1 and L2 bidders. Aditya Birla Renewables, an Aditya Birla Group company, emerged as the lowest bidder, quoting a competitive price of Rs 2.79 per unit. However, three other bidders — Sukhbir Agro Energy Ltd, city-based Gupta Power Infrastructure Ltd and Eden Renewable Varenne Pvt Ltd, were at the L2 level, with a price quote of Rs 3.19 per unit.
“Due to disparity in price, Gridco may not be keen to sign a long-term PPA as it will have a long-term financial commitment for the power purchaser. The average power purchase cost (APPC) of Gridco is still around Rs 2.70 per unit. If the solar component (in procurement) goes up, the APPC will rise further and it may not be feasible for Gridco to pass on to the consumers. However, Gridco has to meet the renewable purchase obligation (RPO) and it may go for a truncated PPA. Gridco has to settle at a situation which will be a win-win for it as well as the investor,” said Swayam Prakash Baral, managing director, Swadesh Infra Marketing Pvt Ltd, a Bhubaneswar-based renewable energy consultancy.
If it (Gridco) goes for power purchase through open access, it will be burdened with wheeling and transmission charges, he added.
Gridco is still evaluating options for executing PPAs. “For L2 bidders, the discovered tariff is a bit on the higher side. There are states where we can procure solar power at more competitive prices. But we haven’t taken a call. As such, there is no compulsion on Gridco to sign PPAs with all the successful bidders,” an official said.
The installed solar power capacity in Odisha is 93 Mw but the state sources about 75 Mw from outside. The latest tariff rate in Odisha for solar power is Rs 4.5 per unit under a scheme of the Ministry of New & Renewable Energy (MNRE).
“The rates discovered in Odisha are satisfactory. However, Gridco has to cough up more money as the difference between the L1 and L2 prices is a whopping 40 paise compared to other states where the figure hovers around one paisa to two paise,” Chandrashekhar Mishra, Managing Director of Canyon Consultancy Pvt Ltd had informed Business Standard in a previous conversation.
Gridco had invited bids for 200 Mw solar power projects with the leeway to ramp up capacity to 300 Mw under the Green Shoe option. The power trading firm may offer the additional 100 Mw to the lowest bidder — Aditya Birla Renewables — though a decision is still pending.
The state bulk power purchaser, which had floated the tender, had received 14 bids from interested players. Against the target of 200 Mw, it received bids for a whopping 845 Mw. Acme Solar, Azure Power, Mahindra Susten Pvt Ltd and Hero Solar Energy Pvt Ltd also participated in the solar tenders.
Source: business-standard
