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India Solar Power Targets

Real Estate Developer Plans 1 GW Solar Power Capacity In India

by Saurabh Mahapatra November 2, 2015

Indian real estate developer Embassy Group plans to make a foray into the renewable energy sector and has announced a target to develop a 1 GW solar photovoltaic power capacity.

The company will initially develop a 200 MW project and expand the installed capacity to 1 GW over a period of 5 years. The plant will be executed by the newly formed subsidiary of the Embassy Group, Embassy Energy. Embassy Energy will be looking after the renewable energy business of the company as an Independent Power Producer (IPP). The plant would entail an invest of Rs 1400 crores (USD 225 million) and will be funded by 70% debt and 30% equity.

The plant will be built over two phases of 100 MW each with expected commissioning of both the phases by March 2017. Once built, this plant will cater to the company’s captive consumption and will supply the power to Embassy Group’s corporate parks in Bengaluru that consume around 3,000 million units annually.

Currently, the company is engaged in the process of securing all approvals and clearances for the plant from the Ministry of New and Renewable Energy (MNRE). The company does not foresee any major challenges in this process since the approval system is very quick for renewable energy projects in India.

“Once the 200MW project is operational, the company will become an IPP (independent power producer). We will then look at doing bigger solar and wind power plants,” said Anshul Singhal, CEO of Embassy Energy. Embassy Group is also planning to set up a solar plant in Pune.

The country’s total installed solar power capacity stands at 4.3 GW at the end of September 2015 wherein Karnataka’s contribution is 104 MW.

India plans to have an operational solar power capacity of 100 GW by March 2022. The government will offer several benefits and incentives to project developers to achieve this ambitious target, and as a result several companies are looking to diversify into the solar power sector.

November 2, 2015 0 comment

Solar Projects

Indian Government Estimates 4.3 GW Solar Power Installation In 2015-16

by Saurabh Mahapatra October 12, 2015

written by Saurabh Mahapatra

The Indian government has posted the most optimistic estimates of solar power capacity addition for the financial year 2015-16. The Indian government expects the states to take the lead in capacity addition probably for the first time since the launch of the National Solar Mission in 2009.

The Ministry of New & Renewable Energy estimates that 4,345 MW solar power capacity would be added between April 2015 and March 2016. A huge majority of this is expected to come from the states which organized auctions under their respective policies. Under the central government’s schemes, projects would be commissioned under the last auction of National Solar Mission conducted by the previous government.

Estimates by a private research firm had put calendar year 2015 capacity addition at 2 GW, which was later revised to 2.5 GW.

Giving a state-wise breakout of the expected capacity addition, the ministry stated that 1,214 MW capacity would be added in Tamil Nadu and 1,166 MW capacity would be added in Telangana. The 2 states alone would thus contribute over 50% of the total capacity addition expected. Madhya Pradesh (432 MW), Andhra Pradesh (350 MW), and Punjab (229 MW) would also contribute significantly through their solar power policies.

Under the central policy, projects would continue to be commissioned that were allocated under the auction of Batch I Phase II of the National Solar Mission. The auction was held in mid-2013 and projects were allocated in early 2014. A total capacity of 750 MW was allocated under the auction. A majority of this capacity is already operational, however, 330 MW capacity is yet to be commissioned and is expected to come online by March 2016.

Additionally, 240 MW of rooftop solar power capacity is also expected to be commissioned this financial year.

The Ministry has given details of the ‘scheduled’ capacity addition as per the requirement under auctions. Some additional capacity may also be added under the Renewable Energy Certificate scheme.

During the first 6 months of this financial year, 518 MW solar power capacity has been added, taking the total installed capacity to 4.26 GW. The ministry had announced a target of adding 1.4 GW capacity during this financial year’s budgetary announcement.

October 12, 2015 0 comment

Solar Projects

India Likely to Add 10.8 GW Solar Power Capacity In 2016-17

by Saurabh Mahapatra October 12, 2015

written by Saurabh Mahapatra

India may have operational solar power capacity of close to 20 GW by March 2017 if projects under the states’ and central solar power policies go ahead as per the schedule.

An estimated 10.8 GW capacity is expected to be added between April 2016 and March 2017, a recently issued document by the Ministry of New & Renewable Energy (MNRE) states. A huge portion of this capacity is expected to be added through central government policies while states would continue to play catch-up.

The Solar Energy Corporation of India (SECI) is expected to have commissioned 1.6 GW capacity through the capital cost subsidy scheme. Additionally, 44 MW of canal-top solar power systems and 50 MW capacity at government-owned buildings and infrastructure is likely to be installed under the purview of SECI. 1 GW rooftop solar power capacity is also likely to be added by SECI.

India’s largest power generation company NTPC Limited will auction 3 GW solar power capacity under the bundling scheme. NTPC Limited would act like a nodal agency for implementation of these projects. Power from these projects will be bundled with power from coal-based power plants to reduce the effective off-take price. The company has already started these auctions and has also allocated some capacity. An estimated 2.5 GW capacity is expected to be commissioned in 2016-17 by project developers participating in these auctions.

NTPC Limited will also add substantial solar power capacity to its own power generation mix. The company may either develop these projects on its own or auction them to other developers, but these projects shall be owned by the company itself. NTPC plans to add just over 3 GW capacity through this and most of the 2.6 GW of that capacity is expected to the commissioned in 2016-17.

The MNRE has also asked NTPC Limited and Power Trading Corporation Limited to auction 1 GW capacity each through foreign currency equated tariff auctions. Through such auctions, prospective project developers would be able to bid in Euro, US Dollars, and Japanese Yen. About 1 GW capacity from this mode is expected to be commissioned in the next financial year.

Other central government-owned companies like Coal India Limited, Indian Renewable Energy Development Agency, and THDC Limited (formerly Tehri Hydro Development Corporation) are also expected to have 500 MW capacity commissioned.

Under the state solar power policies, Telangana is expected to add 500 MW capacity, while Punjab, Karnataka, and Madhya Pradesh are expected to add 300 MW capacity each. Uttar Pradesh is likely to see 215 MW capacity added.

Thus, a total of 9,244 MW solar power capacity is expected to be added under the central government policies while 1,615 MW capacity is expected to be added under the state solar power policies.

The MNRE estimates that around 4.3 GW capacity would added in financial year 2015-16, and with the estimated 10.8 GW capacity addition in 2016-17, India may have around 19 GW operational solar power capacity by March 2017.

October 12, 2015 0 comment

Solar Projects

4.8 GW Solar Power Capacity Up For Auction In India Over Next 6 Months

by Saurabh Mahapatra October 12, 2015

written by Saurabh Mahapatra

Record capacity is expected to be up for auction in India’s solar power market over the next 6 months, giving a sneak peek of the expansive solar power program planned by the Indian government.

About 90% of the capacity to be floated for auction will be under the central government’s policies. The largest auction will have 750 MW capacity to be implemented in the western state of Rajasthan. The auction will be conducted by NTPC Limited and the capacity would add to its owned installed capacity. The company will also auction an additional 1 GW capacity under the mode in Madhya Pradesh and Telangana. For its own projects, NTPC Limited will hold auctions for a total capacity of 1,750 MW.

Acting as a nodal agency for the Solar Energy Corporation of India (SECI), NTPC will auction 650 MW solar power capacity across 4 states. The power generated from these projects will be bundled with power generated from NTPC’s own coal-based projects. The largest of these auctions will have 400 MW capacity, which would be commissioned in Telangana. Jammu & Kashmir and Odisha will have 100 MW and 50 MW capacity installed, respectively, while the host state for the balance 100 MW capacity is yet to be decided.

The SECI will directly auction 37 MW of canal-top solar power capacity for implementation in 4 states. The largest among these will be for Uttaranchal where 20 MW capacity is scheduled to be auctioned. Karnataka will host 10 MW capacity, and Uttar Pradesh 6 MW and Kerala will have 1 MW capacity.

The SECI will also auction projects under the viability gap funding scheme wherein the prospective project developers would be required to bid for subsidy needed in capital cost investment for the project. A total capacity of 1,920 MW would be auctioned through this mode over the next 6 months. The largest auctions would have 500 MW capacity each and the projects shall be hosted in Karnataka, Tamil Nadu, and Uttar Pradesh. Rajasthan would host 250 MW capacity, Kerala 100 MW, Uttaranchal 35 MW, Meghalaya 10 MW, and Lakhshadeep 5 MW capacity.

Only one state is expected to hold auctions under its solar power policy over the next 6 months. Karnataka will float a tender for 500 MW capacity this month.

October 12, 2015 0 comment

Solar Projects

Solar Power Bids Fall By Over 50% In 5 Years In India

by Saurabh Mahapatra October 12, 2015

written by Saurabh Mahapatra

The steep fall in prices of solar panels over the last few years probably seems best reflected in the trend of bidding in competitive auctions in India. The sharp fall in panel prices, accompanied by aggressive policy decisions and falling lending rates have brought solar power prices in India to the edge of grid parity.

A total of 6,781 MW solar power capacity has been allocated through competitive auctions for feed-in tariffs in India between December 2010 and September 2015. The Indian government has also auctioned projects on the basis of subsidy in capital investment at fixed feed-in tariffs.

The first auction in December 2010 under the central government policy of National Solar Mission saw developers bidding between Rs 10.95/kWh and Rs 12.76/kWh. A total of 150 MW solar PV capacity was auctioned with a weighted average bid of Rs 12.16/kWh. The auction saw participation mostly from Indian companies that did not have much experience in installation of solar PV projects.

The next auction came a year later in December 2011 and saw a sharp decline in bids. A total of 350 MW solar PV capacity was auctioned under the National Solar Mission policy. The range of the bids was between Rs 7.49/kWh and Rs 9.39/kWh with a weighted average bid of Rs 8.79/kWh.

Four auctions were held in 2012, all under state solar power policies. A total of 235 MW capacity was auctioned in these auctions with weighted average bids ranging between Rs 8.05/kWh and Rs 8.36/kWh. The lowest bid in these auctions was Rs 7.00/kWh.

By the start of 2013, auctions had started seeing participation from foreign and more serious Indian developers. A total of 6 auctions were held, again all under the state solar power policies, allocating 981 MW capacity. These auctions saw levels of Rs 7.00/kWh being comprehensively broken through with lowest bids falling to as low as Rs 5.50/kWh. Some states, however, witnessed higher bids of more than Rs 8.00/kWh. These states (Uttar Pradesh and Punjab) had organized their first auctions, and both being agricultural states, had costlier land rates compared to other states like Andhra Pradesh, Tamil Nadu, and Rajasthan, which had seen a steeper fall in bids.

2014 saw fewer but larger auctions, with a total of 1,600 MW capacity auctioned by states. Weighted average bids remained stable at just under Rs 7.00/kWh.

In 2015, 8 auctions were organized up to September with a total of 3,465 MW on offer. Bids in these auctions dropped through the Rs 6.00/kWh rate. The lowest bid of Rs 5.05/kWh was placed in the 300 MW auction under Madhya Pradesh solar power policy. Punjab, which had seen comparatively higher bids between June 2013 and early 2015 also saw sharp correction in the 500 MW auction held in September 2015. Bids in Punjab had ranged between Rs 6.88/kWh and Rs 8.75/kWh in the 3 auctions held between 2013 and early 2015 but the September 2015 auction saw weighted average bids falling to Rs 5.65/kWh.

The recent fall in the bids is a result of a combination of factors like improved regulatory outlook, more aggressive intent shown by the government to expand renewable energy infrastructure, revival in economic activity, and fall in lending rates.

The new government has set an ambitious target of 100 GW installed solar power capacity by 2022 and had also urged state governments to adopt and implement solar power policies at an increased pace.

October 12, 2015 0 comment