The state with the highest installed solar power capacity in India, Tamil Nadu, will procure more solar power through competitive bidding. The Tamil Nadu Electricity Regulatory Commission (TNERC) in an official affirmation allowed Tamil Nadu Generation and Distribution Corporation Limited (TANGEDCO) to procure 500 MW more solar power.
In April 2016, Tamil Nadu cut down its FiT by nearly 30% to 5.10 INR per kWh ($0.08) from the earlier 7.01 INR per kWh ($0.11) (see Tamil Nadu Cuts FiT). According to clean energy consultancy Bridge to India, Tamil Nadu and some other southern states in India are expected to add 80% of all new utility scale solar power capacity in 2016.
Reporting the development, Indian business daily The Hindu stated that the order puts TANGEDCO at liberty to restrict the purchase below the specified limit 'after a prudence check with respect to the energy consumption and reduction of energy generated from hydro sources'.
This will now allow the southern Indian state to meet its Renewable Purchase Obligation (RPO) of 5% for fiscal year 2017-18. The target in the current fiscal year 2016-17 is 2.5%. According to a June 2016 report in the newspaper Deccan Chronicle, the state needs to install 2,500 MW of solar power to meet the 5% RPO target next year.