SECI Achieves Significant Tariff Reduction in Solar-ESS Auction, Marking Progress in Renewable Energy Competitiveness – EQ
In Short : The Solar Energy Corporation of India (SECI) has achieved a 5.8% tariff reduction in its latest solar-plus-energy storage system (ESS) auction, reaching ₹4.98 per kWh, down from ₹5.60 in the previous tender. The 630 MW capacity was awarded to JSW Neo Energy, Vena Energy Aura, Hero Solar Energy, Hexa Climate Solutions, and Serentica Renewables, reflecting increased competitiveness and sector maturity.
In Detail : The Solar Energy Corporation of India (SECI) has successfully achieved a notable reduction in tariffs during its latest solar-plus-energy storage system (ESS) auction. The tariff discovered in this auction was ₹4.98 per kilowatt-hour (kWh), marking a 5.8% decrease from the previous SECI tender, where the tariff was ₹5.60 per kWh. This significant reduction reflects growing competitiveness in the renewable energy sector.
The auction, conducted under the Firm and Dispatchable Renewable Energy (FDRE) Tranche IV scheme, allocated a total capacity of 630 megawatts (MW) to multiple companies. Among the winners, JSW Neo Energy secured the largest share of 230 MW at the reduced tariff of ₹4.98 per kWh. Vena Energy Aura and Hero Solar Energy each obtained 100 MW at the same rate.
Other winners in the auction included Hexa Climate Solutions and Serentica Renewables. Serentica secured 100 MW at a slightly higher tariff of ₹4.99 per kWh, demonstrating the competitive nature of the bidding process. The outcome of the auction indicates that developers are increasingly willing to offer lower tariffs to secure projects, driven by improved efficiencies and technological advancements.
A key factor contributing to the reduced tariffs was the adjustment in the Demand Fulfillment Ratio (DFR) from 90% in the previous Tranche II to 80% in the latest Tranche IV. This change made it more feasible for developers to meet their supply commitments, encouraging more competitive bidding and ultimately leading to lower costs.
The FDRE model adopted in this auction focuses on aligning renewable energy generation with consumption patterns, making the energy output more consistent and reliable. This model enhances the viability of renewable projects by ensuring that energy production follows demand more closely, similar to traditional power generation methods.
The success of this auction underscores the continued progress in India’s renewable energy sector, reflecting both technological advancements and a maturing market. With more tenders in the pipeline, SECI aims to further reduce costs and integrate renewable energy into the national grid, contributing to the country’s sustainable energy goals.
