The wind energy auction organized by the state government of Gujarat its power distribution company Gujarat Urja Vikas Nigam Ltd (GUVNL). revealed a tariff of Rs 2.43/kWh as the lowest bid.
Earlier this year, the tariff touched a new low of Rs 3.46 in first round of auction for one gigawatt by Solar Energy Corporation of India (SECI). In October, the tariff fell again to Rs 2.64 in second round of auction for one gigawatt by SECI.
The tender was floated for an allocation of 500 megawatts of capacity. The competition was so fierce that 12 developers submitted bids for a cumulative capacity of 1,527 megawatts, more than thrice the capacity on offer.
The largest capacity was secured by Sprng Energy, a platform of Actis Energy. The company won 197.5 megawatts of capacity at the lowest tariff of Rs 2.43/kWh.
Verdant Renewables won rights to develop 100 megawatts of capacity at Rs 2.44/kWh.
Such is the competition that ReNew Power missed out on the 200 megawatt capacity due to a quote of Rs.2,45/kWh which was 2 paise more than the winning bid. The reason for this fierce competition is the lack of any power purchase agreements being carried out on the basis of feed-in tariffs.
The high competition and conducive conditions in this particular auction resulted in wind energy tariffs in India becoming even cheaper than solar power tariffs. India’s lowest solar power tariff stands at Rs 2.44/kWh.
The availability of adequate infrastructure for renewable energy projects, including evacuation and transmission infrastructure, resulted in this sharp drop in tariffs.