India’s renewables-plus-storage tenders mark a new beginning with highly competitive tariffs: NSEFI
The recently concluded 400 MW renewables auction to supply 24-hour electricity saw winning bid of INR2.90/kWh—a new milestone after peak+off-peak tariff of INR4.07 was achieved in January’s 1.2 GW auction demanding assured power supply during peak demand hours.
India should build on the success of its auctions for 400 MW ‘round-the-clock’ (RTC) and 1200 MW assured peak-hour supply from renewable energy sources, according to the National Solar Energy Federation of India (NSEFI).
There is a need to come out with more such tenders for RE based assured peak-hour supply, round-the-clock supply and even newer products like flexible power supply (supply of power for 10 to 12 hours every day), said the lobby group while congratulating the Ministry of New and Renewable Energy (MNRE) and the Solar Energy Corporation of India (SECI) on successfully concluding these auctions.
Notably, SECI’s 400 MW ‘round-the-clock’ renewables tender to supply 24-hour electricity was recently won by ReNew Power, which agreed to accept INR2.90/kWh ($0.0382315) for power generated. The tariff will increase by 3% per year for the first 15 years of the 25-year power supply deal secured by ReNew before becoming a fixed payment.
“It is truly a historic moment in the history of renewable energy in India. Even amidst these unprecedented times, this is the second successful auction of RE power since the lockdown has been imposed, which signifies the resilience of India’s RE sector and the confidence it exudes amongst investors. Moreover, it is now clear that Coal has become priced out in the country by renewable energy with a significant margin,” commented NSEFI chairman Pranav R Mehta.
Earlier this year, SECI concluded what it called the world’s largest renewables-plus-energy-storage capacity tender. The procurement exercise to contract 1.2 GW of capacity in the form of assured supply of 600 MW of clean power for six hours daily during peak demand hours saw Greenko securing 900 MW of pumped storage capacity and Renew Power 300 MW of battery storage.
Greenko offered a weighted average tariff of Rs4.04/kWh and a quoted peak tariff of Rs6.12/kWh. ReNew Power secured the remaining 300 MW of capacity with a weighted average bid of Rs4.30 and quoted peak price of Rs6.85.
Subrahmanyam Pulipaka, chief executive of NSEFI, acknowledged such innovative bids have discovered highly competitive tariffs and need to be encouraged further. Such projects would help substitute conventional power with renewable power and provide relative comfort from the variability of standalone solar and wind generation. Additionally, distribution licensees will be able to meet their demand while fulfilling their Renewable Purchase Obligation, which are the primary requirements of the distribution licensees.
Pulipaka further submitted these bids are valuable to every stakeholder of the entire value chain, including distribution licensee, renewable energy developers and the society, and can position India at yet another level globally in terms of integration of large-scale renewable energy.
He highlighted: “Through RE RTC bid, MNRE made a new beginning towards firm, schedulable and affordable RTC supply through 100% RE power. These bids are quite distinct from previous plain vanilla bids conducted by SECI for procurement of wind and solar power.”