India’s solar power sector turns a corner
India’s solar power sector has turned a corner after the record low-winning bids of Rs2.97 per kilowatt-hour (kWh) to build 750 mega watt (MW) plant at Rewa in Madhya Pradesh (MP). With effective levelized tariff—the value financially equivalent to different annual tariffs over the 25 year period of the power purchase agreement—of around Rs3.30 per unit, the power from sun has become a competitive energy source vis-à-vis the coal-fuelled conventional source of electricity. The bids were called by Rewa Ultra Mega Power Ltd, a joint venture of Solar Energy Corp. of India Ltd (SECI) and MPUVNL. The issue also assumes importance given India’s commitments within the United Nations Framework Convention on Climate Change and the country receiving solar radiation of 5 to 7 kWh per sq. m for 300-330 days in a year. A quick tariff comparison with conventional fuel sources such as coal drives home the point about solar energy no longer being a green fad but a game changer in India’s energy mix. A case in point being state-run NTPC Ltd; India’s largest power generation utility, which supplies electricity from coal fuelled power projects at Rs3.20 a unit. Also, according to Bridge to India, a solar energy consulting firm, successful bids for new thermal power plants in India in the past two years have been between Rs3.93 and Rs 4.98 per kWh. “No one expected a tariff of Rs2.97 per unit for the Rewa project…As compared to US¢ 4.4/kWh, the tariffs bid in West Asia have been as low as US¢ 3/kWh. This is primarily due to low cost of financing there,” added Sanjeev Aggarwal, managing director and chief executive of Amplus Energy Solutions Pvt. Ltd, which has offered to sell rooftop solar power at a record-low tariff of Rs3 per unit.
Tags : ALLIED