Kerala Invites Solar Bids For 200 MW

• Kerala opens bid for ground-mounted grid-connected PV projects in the range of 10 MW to 200 MW
• Benchmark tariff set at 7.04 INR per kW; developers to look for land themselves
• Consultancy Bridge to India believes tariffs can go higher than in other Indian states because of 'onerous' bidding conditions

The Indian state of Kerala plans to develop 200 MW of solar PV power plants, which will be awarded through a competitive bidding process. The Karnataka State Electricity Board Limited (KSEBL) has released request for proposal (RfP) documents for the auction to meet its renewable purchase obligation (RPC) requirements.

The ground-mounted grid-connected solar PV power plant scheme is the first large scale solar power project issued by KSEBL for consumer use. According to Indian Ministry of New and Renewable Energy (MNRE), the state of Kerala currently has only 12.025 MW of installed solar capacity. Of this, almost 12 MW belongs to one project installed at the Kochi International Airport, touted as the first airport in the world to completely operate on solar power.

Indian consultancy Bridge to India points out that this tender shows smaller Indian states are starting to express their interest in solar power. In a blog post, it stated, "We expect good response from the developer community, but tariffs are expected to be higher in comparison to recent tenders because of more onerous bidding conditions."

Out of the 200 MW capacity, a bidder can bid for a minimum of 10 MW. There is a benchmark tariff that cannot go beyond 7.04 INR per kWh. The tender guidelines require bankability criteria from the bidders, at a net worth of at least 3.5 million INR per MW of capacity offered. Bidders will be required to look for suitable land themselves. This will discourage small developers to bid for the projects, believes Bridge to India. Moreover, not only tight bankability conditions set in the tender will lead to 'higher bid costs for developers; with Kerala being a relatively small and fertile state, land acquisition will be more challenging and costly in comparison to other states,' says Bridge to India.

The deadline for online submission of bids is April 28, 2016; the bids will be opened on May 24, 2016.