After May 2017 when a record winning tariff of 2.44 INR/kWh was reported in India, tariffs have been moving uphill due to tax uncertainties and high module prices. Following recent subsidy cuts and quickly decreasing module prices, the 2 GW SECI auction has seen again very low solar tariff bids, which are supposed to decrease even further in the near future.
- ACME Solar has won 600 MW solar power capacity in SECI auction for 2 GW PV capacity for tariff as low as 2.44 INR ($0.035) per kWh
- It had won 200 MW, also for 2.44 INR tariff, already in a SECI auction for Bhadla Solar Park in May 2017
- Other winners of the 2 GW ISTS connected capacity are Shapoorji Pallonji, Hero Solar Energy, Mahindra Susten, Azure Power and Mahoba Solar
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India’s solar industry might feel like experiencing a déjà vu these days. Solar power project developer ACME Solar has won 600 MW in a Solar Energy Corporation of India (SECI) tender for the lowest winning bid of 2.44 INR ($0.035) per kWh.
A year back in May 2017, ACME Solar had won 200 MW PV capacity for a SECI auction for Bhadla Solar Park for 2.44 INR, a historic low tariff achieved in auctions (see ACME Wins 200 MW At 2.44 INR Record).
This time, ACME won the solar capacity in the 2 GW Interstate Transmission System (ISTS) connected PV tender that was launched by SECI in January 2018 (see SECI Launches 2 GW PV Tender). The tender was oversubscribed by close to 90% with 3.8 GW of bids coming in. SECI had fixed 2.93 INR ($0.046) per kWh as the benchmark tariff for this tender.
According to local daily The Economic Times (ET), the other winners were Shapoorji Pallonji that won 250 MW for 2.52 INR ($0.037) per kWh. Hero Solar Energy and Mahindra Susten won 250 MW each offering a tariff of 2.53 INR ($0.037) per kWh. Azure Power was another winner securing 600 MW capacity, also for 2.53 INR. ET reported that Adani’s Mahoba Solar (UP) Private Limited won the remaining 50 MW for 2.54 INR ($0.037) per kWh.
It has taken a year for solar tariffs to come down to a historic low first achieved in May 2017. According to data from Mercom India Research, winning tariffs for subsequent auction ranged higher – between 2.65 INR to 2.82 INR ($0.038 to $0.041) per kWh until most recently. In May 2018, SoftBank won 200 MW capacity for Pavagada Solar Park in a SECI auction with a winning bid of 2.82 INR ($0.0416) per kWh.
Developers have been bidding for higher tariffs owing to the uncertainty regarding the imposition of safeguard duty and higher panel cost from China until recently. But China’s subsidy cuts in June have sent module prices on a steep downhill trip, which allows solar power project developers to offer project bids at lower tariffs.
With several more tenders in the pipeline, and upcoming auctions, the tariffs are expected to drop even lower.