India’s solar power market has a new lowest tariff as a subsidiary of SkyPower won rights to develop 150 MW of solar power photovoltaic capacity in the state of Madhya Pradesh.
Madhya Pradesh had offered a capacity of 300 MW to prospective project developers. The tender was oversubscribed over 12 times with project developers offering to develop over 3.7 GW of capacity.
Mauritius-based SkyPower Southeast Asia Holdings secured rights to develop 3 projects of 50 MW capacity each at tariffs ranging from Rs 5.051/kWh (7.95¢/kWh) to Rs 5.298/kWh (8.34¢/kWh). The previous lowest bid in India were placed by First Solar at Rs 5.25/kWh (8.27¢/kWh) for a 40 MW project in Andhra Pradesh.
The bid placed by SkyPower is 28% lower than the tariff determined by the Central Electricity Regulatory Commission (CERC) for the current financial year. The CERC has determined a tariff of Rs 7.04/kWh as a financially viable rate for solar PV projects.
The record low tariff bids have put in question the requirement of subsidies for solar power projects. Later this year, the central government plans to auction solar PV projects with a component of viability gap funding in the tariff.
SkyPower won bids for the projects by beating some of the leading Indian and international project developers, including Suzlon Energy, Reliance, Adani Power, ACME Solar, Welspun Energy, First Solar, and SunEdison.
SkyPower has set a target to add 9.9 GW solar power capacity in India over the next 5–7 years. The company plans to soon announce the launch of its India Solar Fund, which will provide a platform for investors, partners, and stakeholders to invest alongside SkyPower and participate with SkyPower as it grows throughout India.