Andhra Pradesh Continues On Solo Drive, With Invite For 6.4 GW Solar Bids

Bids for 6.4 GW of solar projects have been called by the state agency, APGECL, for plants to come up at 10 locations across Andhra Pradesh

Bids for 6.4 GW of solar projects have been called for by the state agency, the Andhra Pradesh Green Energy Corporation Limited (APGECL). These plants are supposed to come up at 10 locations across the state.

The latest announcement follows the state government announcement of plans to build solar infrastructure for 10 GW, early this year. That, after a year in which the state government, by its act of attempting to renegotiate PPA’s signed by the preceding government, did more damage and delay to the state’s and country’s solar march than almost any other event sans Covid in recent times. Thus, it remains to b seen just which firms bid for and win these contracts, seeing how some of the biggest players have been impacted by the earlier moves of the state government.  Worse for a government that felt shortchanged by older rates vis a vis bid of Rs 2.44 last year, the latest lows of Rs 2 per unit will only make it tougher for it to show it has achieved a significant breakthrough if one takes into account the massive delays it has already caused.

Ironically, the announcement comes on a day when two national-level solar and wind developer associations respectively (NSEFI and IWPA), have written to the registrar at the Andhra Pradesh High court, to urge an early hearing of their ongoing dispute with the state government overpayment delays caused by the PPA dispute.

The locations for the planned new plants are spread all over the state,  with sizes ranging from 400 MW at Thondur, to 1200 MW at Kambadur.

Interested bidders will have to submit an amount of Rs 150,000/MW as the earnest money deposit (EMD). The last date to submit the bids is December 28, 2020, and the opening of bids will take place on January 07, 2021.

The tender documents, specify a minimum bid size of 300 MW and in multiples of 300 MW except for the 400 MW project. Borrowing from the formula used in the last major SECI auction, it also specifies that for every Rs 100,000 /MW incurred towards Basic Customs Duty (BCD) and safeguard duty, the quoted tariff (after the e-reverse auction) will be increased by Rs 0.0055 /kWh.

The PPA term has also been set at 30 years, in a further effort to lower tariffs. Developers will have the option to develop 50 percent of the capacity over what’s quoted by the bidder under the greenshoe option within six months from the date of the issuance of the letter of award (LoA).

APGECL will purchase any excess generation over and above 10% of declared annual CUF at a fixed tariff of 75% of the PPA tariff.