Mercom report claims large scale solar project costs are coming down after 11 quarters & 518 MW solar open access added in CY Q1/2023; TPREL wins LOA for 966 MW RTC hybrid power plant from Tata Steel; MNRE to set up DRC to solve disputes between RE developers/EPC contractors and REIAs.
Project costs coming down: Mercom India Research counts the average cost of large scale solar projects in CY Q1/2023 to have decreased by 5% QoQ for the 1st time in 11 quarters thanks to a drop in module prices. Its report Q1 2023 India Solar Market Quarterly Update, Mercom analysts think it is mainly due to the extension from sticking to the Approved List of Models and Manufacturers (ALMM) for solar module procurement and supply chain and prices of components coming down with capacity expansions. As more capacity comes online, module prices will continue to decline leading to overall project costs also coming down since modules alone account for 50% to 60% of the project costs.
Nonetheless, prices of inverters has gone up 11.5% QoQ because of limited availability of insulated gat bipolar transistors (IGBT) and other semiconductors, and that of module mounting structures by 30% mainly due to high prices of steel and aluminum.
Open access grows in India: In its Q1 2023 Mercom India Solar Open Access Market Report, the firm counts India to have added 518 MW solar open access in CY Q1/2023 with Karnataka as the frontrunner thanks to the presence of a mature IT market in the state. This is a 68% sequential increase which Mercom India's MD Priyadarshini Sanjay attributes to demand from commercial and industrial (C&I) consumers as they seek cost-saving alternatives in light of increasing retail electricity tariffs. Big data centers are also looking for higher capacities to run their operations. Companies are also investing in open access, guided by their environmental, social and corporate governance (ESG) and RE100 commitments, she added. At the end of March 2023, India's cumulative installed solar open access project development pipeline had reached close to 6.4 GW.
LOA for 966 MW project: A subsidiary of Tata Power Renewable Energy Limited (TPREL), TP Vardhaman Surya Limited has received a letter of award (LOA) for the development of a 966 MW round-the-clock (RTC) hybrid renewable power for Tata Steel. Calling it one of the biggest industrial RTC power PPAs under group captive segment in the country, TPREL says it has a hybrid renewable capacity of 379 MW solar and 587 MW wind power. The project will help Tata Steel fulfil a significant part of its green energy requirements in India. The latter has an annual crude steel production capacity of 35 million tons per annum (MTPA). It will also invest 26% equity in the hybrid project that's scheduled to be commissioned by June 1, 2025. TPREL counts its total renewable energy capacity to have reached 7.756 GW comprising 3.107 GW solar, 952 MW wind and another 3.7 GW under various stages of implementation.
DRC for renewable energy companies: The Ministry of New and Renewable Energy (MNRE) has announced setting up a dispute resolution mechanism (DRM) to resolve unforeseen disputes between renewable energy power developers/EPC contractors and any of the renewable energy implementing agency (REIA) designated by it as SECI/NTPC/NHPC/SJVN. It will consist of an independent, transparent and unbiased dispute resolution committee (DRC) to resolve issues beyond the scope of contractual agreements between companies and the agencies.