The bidding for 500 MW of solar photovoltaic capacity envisaged in Telengana saw an intense competition among some of the country’s leading players in the sector with the gap between the lowest and highest tariffs quoted in the winning bids being narrow at less than 50 paise.
Renew Power Ventures bagged the largest chunk among winners by cornering 140 MW capacity which includes 100 MW at R6.73 per unit tariff and 40 MW at R6.80 per unit. ACME Solar followed with 80 MW capacity.
As per the terms and conditions of the bidding document, the selected developers would sign a 25-year long PPA with Telangana Discoms — TSSPDCL and TSNPDCL — on qualified tariff. The project has to be commissioned within 10 months after signing of the PPA and the financial closure of the project must be done within 150 days after the signing of the PPA.
“The project is doable within the stipulated time frame of 10 months. We are already engaged in talks with land owners in Mehboob Nagar district for land acquisition,” Renew Power Ventures CEO Sumant Sinha told FE, adding that the company is engaging with land owners directly.
On the funding front, Renew Power said it will tap into its internal funds and cash flow for the project. With funding from Goldman-Sachs, Asian Development Bank and Global Goldman-Sachs, Renew had reached an equity investment of $390 million earlier this year.
ACME estimates the cost of the 80 MW project to be R660 crore and intends to use half of the $100-million loan granted to company last month by Asian Development Bank. A solar project of 100 MW typically requires investment of R700 crore.
First Solar (65 MW), Solairedirect Energy (40 MW), and Mahindra EPC (30 MW) have also won substantial chunk of the capacity on offer.
Telangana’s successful bidding process has followed the equally well-received tariff-based competitive bidding by Andhra Pradesh for the same capacity last month.
These southern states are severely energy starved as nearly 7000 MW of gas-based capacity has been sitting idle due to paucity of gas. As a result, Andhra and Telangana have bet big on solar to reduce their dependency on gas-based power plants.
