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Tamil Nadu Solar Power

This Indian State Plans Taxes, Reduced Tariff For Rooftop Solar Projects

written by saurabh

While the central government and most states in India are looking to promote, even obligate, the use of rooftop solar power projects, one state is looking to reduce tariffs for rooftop solar power systems and even impose tax on revenue generated from sale of the electricity generated.

The power utility of the Indian state of Tamil Nadu has approached the state’s electricity regulators asking it to reduce the tariff offered to rooftop solar power systems for consumers and impose an additional tax on the revenue. According to media reports, Tamil Nadu Generation and Distribution Company (TANGEDCO) has proposed to fix the tariff of electricity generated from rooftop solar power systems at 50% of the lowest tariff offered to utility-scale solar power projects in the state.

Several other conditions have also been proposed by the utility. It proposes that consumers be allowed to install rooftop solar power systems up to only 50% of their contracted demand. Perhaps one of the most shocking proposal is introduction of an additional tax on revenue from the power generated by these systems.

At present, there is no cap on the size of rooftop system that can be installed by a consumer. The electricity generated by the system is subtracted from the electricity consumed from the grid and the consumer pays for the net electricity consumption. By reducing the tariff applicable to electricity generated from rooftop systems, the utility would effectively reduce the generation, thus increasing the power bill for consumers.

The utility plans to fix the tariff of rooftop systems to half of the tariff offered to solar power companies in the states. While the media reports are not clear on the exact figure, the tariff could be lower than Rs 2.00/kWh (3.1¢/kWh) as 1.5 gigawatts capacity was recently auctioned to developers at Rs 3.47/kWh (5.4¢/kWh).

Last month, TANGEDCO received massive response to the tender with project developers willing to set up 2.67 gigawatts capacity against the offered 1.5 gigawatts capacity. The bids submitted by the participating companies varied from Rs 3.47/kWh (5.4¢/kWh) to Rs 4.00/kWh (6.2¢/kWh), the maximum allowed bid.

The main reason behind this move is the poor financial health of the utility. It is know to delay payments to wind and solar power developers despite having long-term power purchase agreements with them. Experts are also baffled by this proposal because TANGEDCO loses 19-25% of the electricity while supplying it to end consumers. Rooftop solar power systems would mean near-zero losses of electricity as the point of generation and consumption is the same.



July 30, 2017 0 comment
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India Coal Company Bags 709 MW Solar In Auction

India Coal Company Bags 709 MW Solar In Auction

written by saurabh

NLC India Limited, a coal mining and power generation company in India, has taken perhaps its largest set towards a greener and sustainable future after successfully participating in one of the largest solar power auctions in the country.

NLC India, formerly Neyveli Lignite Corporation, recently secured rights to develop 709 megawatts of solar power capacity in the Indian state of Tamil Nadu. The company shall receive Rs 3.47/kWh (5.4¢/kWh) as tariff, likely under a long-term power purchase agreement spanning 25 years.

NLC India had offered to build the entire 1.5 gigawatts of solar power capacity offered in the tender by Tamil Nadu Generation and Distribution Corporation (TANGEDCO) at a tariff of Rs 3.97/kWh (6.1¢/kWh). The company agreed to match the lowest tariff offered in the auction and will now develop 709 megawatts.

Participation in the tender is part of NLC’s overall strategy to move towards a sustainable energy future with reduce share of lignite mining and coal-based power generation. The company plans an investment of Rs 17,400 crore ($2.7 billion) to set up 4.2 gigawatts of renewable energy capacity. This includes around 4,000 megawatts of solar power and 200 megawatts of wind energy capacity.

The company plans to set up 995 megawatts solar power capacity each in the states of Tamil Nadu and Uttar Pradesh. Projects in the both the states are expected to be commissioned in 2019.

NLC India has floated a tender to set up 500 megawatts solar power capacity in Tamil Nadu in December 2016. Details of result of this tender are scarce but Gamesa was reported to have had quoted the lowest bid for 100 megawatts capacity.

In August last year, the company announced that it started construction of a 65 megawatt solar power project at Neyveli in Tamil Nadu. The project has long-term power purchase agreement with TANGEDCO.

Image by vectoropenstock.com for Cleantechies



July 17, 2017 0 comment
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Indian Lawmakers Propose Tariff Reduction For Operational Solar Projects

Indian Lawmakers Propose Tariff Reduction For Operational Solar Projects

written by saurabh

Lawmakers of Indian state of Tamil Nadu recently revealed that they are negotiating with at least one solar project developer to reduce tariff. This could trigger a bad precedent across India as bids for new solar projects continue to decline rapidly.

The project in question in Tamil Nadu is no ordinary solar project. The government of Tamil Nadu is looking to get Adani Green Energy reduce tariff of its 648 megawatt project – the largest in India.

The Adani project, commissioned last year, gets paid Rs 7.01 (11¢) for every unit of electricity it feeds into the grid. That’s a massive premium to the current lowest tariff bid in the country, nearly three times as much.

Tamil Nadu recently issued a tender for 1.5 gigawatts solar power capacity and set a maximum tariff at Rs 4.00/kWh (6.2¢/kWh). It is clear that the government wants to check any ‘unjust’ profits that the developers may be getting due to advancements in technology and the share decline in module prices over the last several months.

A similar attempt was made in 2015 in the state of Gujarat. The projects in question at that time were among the first utility-scale solar power projects in India which predate even the National Solar Mission. The very first projects commissioned in Gujarat are still getting tariffs as high as Rs 12/kWh (19¢).

Power utilities in Gujarat approached the regulators to reduce tariffs of these operational projects but did not find any success. The matter was dragged into a court which ruled in favour of the developers.

Any retrospective reduction in tariffs will also send the wrong message to project developers which could put brakes on India’s march to become one of the largest solar power markets in the world. Any doubt in the developers’ mind could make them ask for new PPA templates which could elongate the regulatory procedures and delay project execution.

Screengrab from NatGeo documentary on Adani Energy solar power plant



July 12, 2017 0 comment
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Indian State Of Tamil Nadu Allocates 1.5 Gigawatts In Latest Solar Tender

Indian State Of Tamil Nadu Allocates 1.5 Gigawatts In Latest Solar Tender

written by saurabh

The south Indian state of Tamil Nadu has completed one of the largest solar power capacity allocation in the country. The state government recently confirmed that it project developers have agreed to develop a 1.5 gigawatts of solar PV power capacity following a competitive auction.

Tamil Nadu Generation and Distribution Corporation (TANGEDCO) has announced that it awarded solar power projects with cumulative capacity of 1,500 megawatts to 16 developers. All these projects have been awarded at Rs 3.47/kWh (5.4¢/kWh), the lowest tariff bid committed by 25 participating developers.

Last month, TANGEDCO received massive response to the tender with project developers willing to set up 2.67 gigawatts capacity against the offered 1.5 gigawatts capacity. The bids submitted by the participating companies varied from Rs 3.47/kWh (5.4¢/kWh) to Rs 4.00/kWh (6.2¢/kWh), the maximum allowed bid.

A public sector company NLC Limited had offered placed a bid to develop the entire 1.5 gigawatts capacity at Rs 3.97/kWh (6.1¢/kWh) but eventually agreed to do it match the lowest tariff of Rs 3.47/kWh (5.4¢/kWh).

TANGDECO called upon all the developers to match the lowest bid and 16, including NLC, responded positively. Raasi Green Earth Energy, a lesser known developer in India, is believed to the have bagged 100 megawatts; the company has placed the lowest bid. NLC was awarded 700 megawatts capacity likely because some other developers refused to match the lowest bid.

The successful tendering is a major milestone for TANGEDCO which has been really struggling to attract solar project developers when compared to other states like Telangana, Karnataka, Andhra Pradesh and Rajasthan.

TANGEDCO had offered 500 megawatts solar power capacity in February 2016 but received bids for just 177 megawatts. The utility put 500 megawatts capacity on the block again in November 2016 but received bids for 300 megawatts only.

The power utility is known to be facing financial challenges accompanied by non-availability of ample grid infrastructure to support renewable energy projects. Tamil Nadu is already the largest wind energy producing state in India.

While project developers have been given upto 24 months to commission their projects, the longest-ever in Indian history, they have chosen to quote tariffs which are at significant premium to the current lowest solar power tariff in the country. ACME Cleantech Solutions currently holds the record for lowest solar power tariff in India at Rs 2.44/kWh (3.8¢/kWh).



July 8, 2017 0 comment
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As Tariff Bids Crash, Indian States Look To Renegotiate Tariff For Operational Solar Projects

As Tariff Bids Crash, Indian States Look To Renegotiate Tariff For Operational Solar Projects

written by saurabh

The trend of retrospective reduction in solar power tariffs seen in Europe few years back has now propped up in India.

Lawmakers of Indian state of Tamil Nadu recently revealed that they are negotiating with at least one solar project developer to reduce tariff. This could trigger a bad precedent across India as bids for new solar projects continue to decline rapidly.

The project in question in Tamil Nadu is no ordinary solar people. The government of Tamil Nadu is looking to get Adani Green Energy reduce tariff of its 648 megawatt project – the largest in India.

The Adani project, commissioned last year, gets paid Rs 7.01 (11.00¢) for every unit of electricity it feeds into the grid. That’s a massive premium to the current lowest tariff bid in the country, nearly three times as much.

Tamil Nadu recently issued a tender for 1.5 gigawatts solar power capacity and set a maximum tariff at Rs 4.00/kWh. It is clear that the government wants to check any ‘unjust’ profits that the developers may be getting due to advancements in technology and the share decline in module prices over the last several months.

A similar attempt was made in 2015 in the state of Gujarat. The projects in question at that time were among the first utility-scale solar power projects in India which predate even the National Solar Mission. The very first projects commissioned in Gujarat are still getting tariffs as high as Rs 12/kWh (19¢).

Power utilties in Gujarat approached the regulators to reduce tariffs of these operational projects but did not find any success. The matter was dragged into a court which ruled in favor of the developers.

Any retrospective reduction in tariffs will also send the wrong message to project developers which could put brakes on India’s march to become one of the largest solar power markets in the world. Any doubt in the developers’ mind could make them ask for new PPA templates which could elongate the regulatory procedures and delay project execution.



June 26, 2017 0 comment
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India’s Tamil Nadu Plans 1.5 Gigawatts Solar Power Tender

India’s Tamil Nadu Plans 1.5 Gigawatts Solar Power Tender

written by saurabh

The power utility of India’s Tamil Nadu state will yet again try its luck at auctioning large-scale solar power projects after it failed to draw interest miserably in the last two auctions.

Tamil Nadu Generation and Distribution Corporation (TANGEDCO) it set to auction 1.5 gigawatts solar power capacity. Prospective projects developers can bid for project sizes of one to 500 megawatts.

The maximum tariff bid allowed will be Rs 4.00/kWh. This threshold tariff is 64% higher than the current lowest solar power tariff in India of Rs 2.44/kWh.

The latest auction is not expected to breach this lowest tariff price. TANGEDCO is not among the best buyers of renewable energy and has been known to default on monthly payments to projects developers. Additionally, project developers in Tamil Nadu face frequent issues of non-availability of transmission infrastructure and are thus forced to shutdown their projects which leads to revenue loss.

TANGEDCO had offered 500 megawatts solar power capacity in February 2016 but received bids for just 177 megawatts. The utility put 500 megawatts capacity on the block again in November 2016 but received bids for 300 megawatts only.

Now, TANGEDCO is taking extra measures to ensure bidders are attracted towards the latest tender. The utility is offering 24 months to project developers to commission projects of size exceeding 50 megawatts; this is the longest time ever given to commission solar PV power projects in India. Project developers will also be compensated in case of unavailability of transmission infrastructure.

Tamil Nadu has very ambitious solar power targets but infrastructure support remains an issue.

According to government estimates, an installed capacity base of 2.5 GW will be required to meet the 5% solar RPO target in 2017-18. TANGEDCO, however, expects that only 1.6 GW solar power capacity would be operational by that time, thus leaving a shortfall of 900 MW.

Image by vectoropenstock.com for Cleantechies



May 24, 2017 0 comment
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Indian Solar Tariff Bids Could Fall To New Low With Fresh 500 Megawatts Tender

Indian Solar Tariff Bids Could Fall To New Low With Fresh 500 Megawatts Tender

written by saurabh

After failing to attract enough bids for the 500 megawatts solar power tender in October last year, the state’s power utility has issued yet another tender for the same capacity.

Tamil Nadu Generation and Distribution Corporation (TANGEDCO) has issued a request for selection (RfS) document for auction and allocation of 500 megawatts solar power capacity. Prospective project developers can submit their bids by 10 February 2017.

The utility had issued a tender in October 2016 which saw a measly response of just 117 megawatts. There are some significant changes in this fresh tender.

Project developers will now be able to bid for upto a maximum capacity of 500 megawatts; thus a single company can secure the entire tender capacity. In the earlier tender, the maximum bid size was 50 megawatts only.

The maximum tariff bid in the October tender was INR 5.10/kWh (7.50¢/kWh) but this threshold has now been reduced to INR 4.50/kWh (6.60¢/kWh). The lowest tariff bid for utility-scale solar power project in India currently stands at INR 4.34/kWh (6.40¢/kWh) in Rajasthan. Thus, if this new tender is fully subscribed the existing lowest tariff bid record may very well be shattered.

There is all likelihood of developers quoting a new record low tariff bid. Since the Rajasthan tariff bid in January 2016 several significant developments have taken place that are conducive for a sharp tariff bid cut.

Interest rates have fallen sharply, especially following the demonetisation drive of the Indian government in early November 2016. Module prices continue to remain very low. TANGEDCO has signed up the financial restructuring plan for power utilities enhancing the prospects of timely payments to project developers. The Indian government has waived off a number of charges for inter-state transmission of solar and wind energy. The Ministry of New & Renewable Energy has also directed states to provide ‘must-run’ status to renewable energy projects.



January 18, 2017 0 comment
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India’s Adani Green Energy Commissions ‘World’s Largest Solar PV Project’

India’s Adani Green Energy Commissions ‘World’s Largest Solar PV Project’

written by saurabh

India’s largest solar power project developed by a single company has finally been fully commissioned.

One of its leading industrial conglomerates – Adani Enterprises – has announced that it commissioned a 648 MW solar PV project in the southern state of Tamil Nadu. Adani Green Energy, a subsidiary of Adani Enterprises, reported that the power plant has started feeding electricity into the grid.

Adani Green Energy is believed to have invested a total of Rs 4,550 crore (US$680 million) in the project which was completed in a record time of eight months. In June this year, ABB India (which erected substations to connect the power plant with the grid) announced that 360 MW capacity was commissioned and linked to the grid.

The Kamuthi solar power park in Tamil Nadu will be spread across 5 different solar power projects. Power generated from park will be sold to Tamil Nadu Generation and Distribution Corporation through a long-term power purchase agreement with duration of 25 years. Adani Group had signed a memorandum of understanding with the government of Tamil Nadu to set up the solar power park in 2015.

The power is expected to be sold at Rs 7.01/kWh (US¢10.0/kWh) which represents a huge premium to the tariffs discovered in the recently concluded solar power auctions. Bids by Indian project developers seem to have stabilised around Rs 4.70/kWh (US$7.00/kWh).

The project is now the largest solar power project implemented by a single developer in India, and perhaps the world. In India, it overtook the 151 MW solar PV project developed by Welspun Renewables in Madhya Pradesh – the project, along with other assets of Welspun Renewables have now been acquired by Tata Power Renewable Energy.

India is also host to the Charanka solar power park, located in Gujarat. The solar power park has an installed capacity of 345 MW developed by several companies, including Adani itself.

Image by vectoropenstock.com for Cleantechies



September 23, 2016 0 comment
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