SunEdison Signs Agreement For 200 Megawatts Solar Project In Bangladesh

SunEdison may have sold off most of the assets in the developed or rapidly developing solar power markets, the company seems to hold on to assets that represent significant premium over other global assets.

A subsidiary of SunEdison has signed an agreement with the government of Bangladesh to set up 200 megawatts solar power project. The power purchase agreement for the project was signed by Southern Solar Power. The company shall set up the power project in partnership with a local firm – Midland Power – which will have 20% equity stake in the project.

The power plant shall come up in the Cox’s Bazar district and is required to be commissioned over the next 18 months.

The fact that could explain why SunEdison remains active in a country like Bangladesh, which has virtually no utility-scale solar power projects, while it has exited one of the fastest growing solar power markets like India is the tariff mentioned in the power purchase agreement.

The solar power plant will receive a tariff of 17¢/kWh for a period of 20 years on a ‘no power, no payment’ basis.

This tariff is at a massive premium to the competitive tariffs seen in India and the world over. Competitive solar power tariffs have fallen to the record low of 2.42¢/kWh. Tariffs in India, where SunEdison recently offloaded 1.7 gigawatts of solar and wind energy assets to Greenko Energy Holdings, have fallen to 4.40¢/kWh for rooftop projects and 6.40¢/kWh for utility-scale solar power projects.

This is the advantage that attracts large renewable energy project developers to under-developed renewable energy markets of Asia and Africa. The lack of competitive auctions for projects allows them to set up projects at feed-in tariffs which are still very high.

SkyPower Global had also announced plans to set up 2 gigawatts of solar power capacity in Bangladesh over the next few years. Indian power company Adani Power also recently expressed intention to set up utility-scale solar power projects in the south Asian country.

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