The solar power sector in India witnessed a new history as tariffs in an auction conducted by Solar Energy Corporation of India’s for 1070 megawatt projects in Rajasthan attracted lowest ever rates of Rs.2 per unit.
The tariff is over 15% lower than the previous lowest rate of Rs.2.36 discovered in another auction SECI for 2000MW in June this year.
Prior to that, solar power developer ACME had won a project in Rajasthan offering Rs.2.44 per unit.
The historic low tariff was quoted by Aljomaiah Energy and Water Company and Green Infra Wind Energy Ltd, a subsidiary of Sembcorp for 200 MW and 400 MW of solar projects, respectively, while central PSU NTPC quoted the second-lowest rate of Rs.2.01 for 600 MW of projects.
Explaining the possible reasons for the lowest tariff, Sunil Bansal, general secretary of Rajasthan Solar Association, said, "Solar module prices have come down by 10-12% in the past few months. Secondly, solar technology is becoming more and more efficient in raising productivity. These are the two main drivers responsible for record lower tariffs. Besides, we are of late witnessing interest of foreign companies in Indian solar sector. That could be another reason."
The winning bidders will sign power purchase agreements with Rajasthan and the sell the power to discoms. The discoms have annual targets to get certain portion of its lower requirement from renewable energy. The 1070MW project will meet the discoms' renewable purchase obligations.