YS Jaganmohan Reddy (in the picture) led Andhra Pradesh state government is fast tracking the 10 GW solar tender for power supply to farmers under the INR 350 billion project. (Photo Credit: Official Website of YSR Congress Party)
- Andhra Pradesh is said to be making efforts to fast-track tender for 10 GW solar power capacity
- According to Mint, one of the major reasons for doing so is to appease international investors that aren’t happy with their investment vehicles being forced to renegotiate contracts for their earlier signed PPAs with the government
- Bids will be called in for the 10 GW tender as soon as land is arranged for the same
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Indian business daily Mint says the State Government of Andhra Pradesh is expediting efforts to launch a tender for 10 GW solar PV capacity, power from which is proposed to be supplied to the state’s farmers. The project was first announced in June 2020 and Andhra Pradesh Green Energy Corporation Ltd. (APGECL) was declared as the nodal agrency for the project (see APGECL Nodal Agency For 10 GW Solar In Andhra Pradesh).
As soon as land is available to host this capacity, the APGECL will call bids, Mint reported. It will launch request for proposal (RFP) round for the 10 GW capacity shortly, it added. It would represent 14% of the country’s green energy capacity and cost an investment of INR 350 billion ($4.76 billion).
One of the major reasons for Chief Minister YS Jaganmohan Reddy led state government to be pushing for this massive tender is to appease international investors who have been miffed by its efforts to derail already signed power purchase agreements (PPA) by developers these companies have invested in, as per the report.
It is reported that fate of some 5.2 GW of solar and wind energy projects in the state that entered PPAs during the previous administration under Reddy’s predecessor Chandrababu Naidu is uncertain as the state government wants to reopen their renewable energy contracts wanting them to lower the winning tariffs. Despite the federal government’s appeals, the Reddy administration has been said to maintain its stance. Mint reports that the state government is trying to resolve the problems associated with the earlier clean energy PPAs.
The ReNew Power, Greenko, Adani Power, PTC India Ltd, SB Energy, Mytrah and Hero Future Energies are some of the affected parties that have money coming from global investors as Goldman Sachs, Brookfield, SoftBank, Canada Pension Plan Investment Board, CDC Group, EverSource Capital and International Finance Group (IFC) among others. Their displeasure with the current administration’s move is apparently the main reason for this urgent push to the 10 GW capacity tender.
Till August 31, 2020, the New and Renewable Energy Development Corporation of Andhra Pradesh Limited (NREDCAP), the state’s operational solar power capacity was over 3.53 GW out of 8.2 GW of renewable energy capacity.