Adani, Azure win solar power projects in UP with lowest bids

Adani Power and Azure Power have secured solar energy projects in Uttar Pradesh with bids of Rs4.78 per unit, the lowest tariff offered in the last three auctions.

At Rs4.78 per unit, the rates, however, are higher than the record low of Rs4.34 set this month in Rajasthan.

Analysts say this has been due to the relatively smaller size of the projects and the lower level of solar radiation in Uttar Pradesh compared with Rajasthan, where the new low was set in the previous round.

Prayatna Developers, a subsidiary of Adani Power, and Azure Power India have both been allotted 50 MW at the same price.

In the last three auctions, winners had quoted lower tariffs. Two of them were for projects offered by NTPC in Rajasthan and Andhra Pradesh, while the other was for a project offered by Solar Energy Corporation of India in Maharashtra.

The lowest bid in Rajasthan was Rs4.34 per kWh, a record, while that in Maharashtra was Rs4.41 and Andhra Pradesh, Rs4.63 per unit.

In Uttar Pradesh, developers will have to acquire land for projects, unlike in Rajasthan and Andhra Pradesh where they will be allotted land in solar parks. Allocation of land as part of the deal in the previous auctions had helped attract foreign companies, which eventually won the projects.

The earlier auctions had also seen higher interest from developers. While there were just seven bidders for a total capacity of 350 MW (against 100 MW on offer) for the Uttar Pradesh projects, there were 20 bidders for 3,850 MW (420 MW on offer) in Rajasthan, 30 for 5,500 MW (500 MW on offer) in Andhra Pradesh and 14 bidders for 1,800 MW (500 MW on offer) in Maharashtra.

The Uttar Pradesh tender was a relatively small one for 100 MW with maximum capacity per bidder of only 50 MW, which, along with the low solar radiation levels, pushed up the cost of the projects.

The Narendra Modi government is aggressively expanding its solar power portfolio with plans to add 1,00,000 MW of green power projects, both by internal and external pressures for a cleaner environment.

On Monday, Prime Minister Narendra Modi and French President Francois Hollande also jointly inaugurated the interim secretariat of the International Solar Alliance at the National Institute of Solar Energy (NISE) in Gurgaon. The solar alliance brings together 121 countries for green energy projects.