Duty Concerns, ISTS Issues May Delay Solar Auctions

NTPC deferred auction of 2,000 MW of solar capacity to the first week of June. However, the state-run power giant did not auction even in the first week of this month.

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Amid ambiguity about the imposition of 70 percent safeguard duty on solar equipment, there is an apprehension that solar auctions would be dragged further. Adding to the uncertainty is concerns among developers over grant of inter-state transmission system (ISTS).

In May, NTPC deferred auction of 2,000 MW of solar capacity to the first week of June. However, the state-run power giant did not auction even in the first week of this month.

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"The issue related to grant of connectivity through inter-state transmission system has not been resolved so far and discussion with the Ministry of New and Renewable Energy (MNRE) is still on. Besides, there is uncertainty over 70 per cent safeguard duty under consideration of the government. Therefore, solar auctions would be dragged further," an industry source said.

He added, "Solar Energy Corporation of India (SECI) has conducted auction for 125 MW of solar capacities for solar parks in Uttar Pradesh last week where successful bidder got the project at a tariff of Rs 3.34 per unit due to developers concerns over the two issues and other reasons."

According to the road map prepared by the Ministry of New and Renewable Energy, auctions of 3.5 GW of solar capacities are planned in June itself. The government has planned 34 GW of solar capacities auction in the current fiscal.

The timely auction is important in view of India's ambitious target of having 100 GW of solar energy by 2022. The government is hopeful of overachieving its solar energy target at 113.49 MW by 2022 as compared to envisaged 100 GW.

Source: PTI