Cost of Solar Power continues to fall in India

[Sloth 22]

NEW DELHI: Solar power tariffs in India have plunged to a new low of Rs 2.44 per unit, continuing the free fall in the cost of green energy after Acme Solar Holdings and SBG Cleantech, the joint venture of SoftBank, Foxconn and Bharti Enterprises, won the latest auction for 500 megawatt of projects in Rajasthan.

Acme Solar won 200 mw with the record low bid, while SBG Cleantech bagged 300 mw quoting one paisa higher in the latest auction in which many Indian and international firms competed intensely.

The auction highlights India’s success in rapidly expanding renewable energy capacity at a low cost, and attracting ambitious bids from reputed companies from many countries including Japan, Taiwan, South Africa, France, Singapore, USA, and Finland in various auctions.

Solar tariffs have plummeted in recent weeks. The latest auction, conducted by the Solar Energy Corp of India for the Bhadla Solar Park, betters the previous record of Rs 2.62 per unit quoted just a few days ago by South African solar heavyweight Phelan Energy Group and local player Avaada Power. SBG Cleantech also won 100 mw in that auction for projects at the adjoining Adani Renewable Energy Park. Before that, the lowest tariff had been Rs 3.15 per kwH, arrived at during an NTPC auction of 250 mw at the Kadapa Solar Park in Andhra Pradesh on April 13 this year.

Power minister Piyush Goyal, who has set very ambitious renewable energy targets and is championing the use of electric cars, said the record low bids signalled a “green future” for India.

Manoj Kumar Upadhyay, chairman, Acme Group that set the record said: “We are delighted. Our operational experience, execution ability and current improvements in the technology gave us the confidence to put in this bid without compromising on quality. We expect an exponential growth in coming days for renewable energy industry.”

The Acme Group, comprising Acme Solar Holdings, Acme Cleantech and other companies, is a wholly domestic enterprise and one of the largest solar developers in the country with 1500 mw of solar assets, either commissioned or under construction in Andhra Pradesh, Telangana, Punjab, Gujarat, MP, Odisha, Bihar, UP and Chhattisgarh.

With the latest auctions, solar tariffs have fallen well below those of power from thermal plants using new coal. “This tariff is less than coal,” said Kumar. “The average NTPC coal plant tariff is Rs 3.20 per kwH. Solar has a brighter future now.”

But a number of experts were also cautious about whether solar power at such rock-bottom tariffs would be viable. “Everything depends on the structure of the bid and how far the risk associated has been taken care of,” said Ashok Haldia, MD and CEO, PTC Financial Services, which has financed many renewable energy projects. “It surely can be viable. It all depends on the project profile and the company.

The tariff is linked to capex, opex, financing cost of IRR (internal rate of return) expectation and all these aspects need to be looked at separately to assess the worthiness of the bids.”

Power tariffs from solar plants located in Bhadla have traditionally been low, since the region – in Rajasthan’s Jodhpur district – gets the highest solar radiation in the country, thereby increasing the capacity utilisation factor of the plants. But what explains the steep fall in the two recent auctions there? “Many international players were participating for the first time which intensified competition,” said Ashvini Kumar, managing director, SECI.

http://m.economictimes.com/industry...com&utm_medium=referral&utm_campaign=ETTWMain

 

[Avon]

Read an article about how investor friendly rules during REWA power plant auction helped price to fall down to 4. These rules include many factors such as tax/MW of production and some hidden taxes as well....during REWA auction there very few hidden taxes which seemed attractive to investors. Wonder how this action was, however, whatever it is , it will speed up solar power generation in India. Hope to see installed capacity go past 20GW by thr end of next FY.

 

[desiHindu]

It's gonna drop even more.
Future of power industry is in Solar & not in any other.

 

[Articulate]

This is brilliant.

Now the next achievement needed is when Solar Power matches Grid parity price without Government subsidies and accelerated depreciation benefits (currently being given to all including the company above).

 

[Banglar Bir]

Indian solar power prices hit record low, undercutting fossil fuels
Plummeting wholesale prices put the country on track to meet renewable energy targets set out in the Paris agreement

Solar panels for sale at a market in New Delhi. India’s solar power prices have fallen to 2.62 rupees per kilowatt hour. Photograph: Saurabh Das/AP
Michael Safi
Wednesday 10 May 2017 13.29 BST Last modified on Wednesday 10 May 2017 23.21 BST

Wholesale solar power prices have reached another record low in India, faster than analysts predicted and further undercutting the price of fossil fuel-generated power in the country.

The tumbling price of solar energy also increases the likelihood that India will meet – and by its own predictions, exceed – the renewable energy targets it set at the Paris climate accords in December 2015.

India is the world’s third-largest carbon polluter, with emissions forecast to at least double as it seeks to develop its economy and lift hundreds of millions of citizens out of poverty.

Ensuring it generates as much of that energy as possible from renewable sources is considered crucial to limiting catastrophic global temperature increases.

At a reverse auction in Rajasthan on Tuesday, power companies Phelan Energyand Avaada Power each offered to charge 2.62 rupees per kilowatt-hour (kWh) of electricity generated from solar panels they hope to build at an energy park in the desert state. Last year’s previous record lowest bid was 4.34 rupees per kWh .
Analysts called the 40% price drop “world historic” and said it was driven by cheaper finance and growing investor confidence in India’s pledge to dramatically increase its renewable energy capacity.

It reduces the market price of solar tariffs well past the average charged by India’s largest thermal coal conglomerate, currently around 3.20 rupees per kWh . Wholesale price bids for wind energy also reached a record low of 3.46 rupees in February.

Kanika Chawla, a senior programme lead at the Delhi-based Council for Energy, Environment and Water (CEEW), said it was encouraging that Rajasthan project bidders were “new players, not the same old market leaders”.

“It shows there is enough happening to attract investment, attract interest from companies who have otherwise been cautious,” she said.

Prices were likely to drop further if the cost of borrowing money continued to fall – which she said was one of the major drivers in the record low prices this year.

“Any future incremental gains in prices will not come from the decline in technology prices, they will come from declines in the cost of finance,” she said.

Investors were also likely encouraged by a recent move to allow the state-backed Solar Energy Corporation of India to act as a guarantor in agreements between energy developers and India’s debt-ridden power distribution companies.

Tim Buckley, a director at the Institute for Energy Economics and Financial Analysis, said the most important factor driving a rush of international investment in Indian renewables was the “transparency, longevity and certainty” of the country’s energy policy.

“That is absolutely critical because when you invest for 25 to 35 years, you need certainty and clarity of policy,” he said.

“India has prime minister [Narendra] Modi saying this is his number one objective, you have energy minister [Piyush] Goyal talking about it every day. There is no doubt in anyone’s mind about Goyal’s commitment to this program and Modi’s endorsement of what Goyal’s doing,” he said.
https://www.theguardian.com/environ...ices-hit-record-low-undercutting-fossil-fuels

 

[StraightShooter]

Great news.

Solar, Wind and Hydel need all the thrust.