Modi govt plans to auction 4 GW of wind energy
Prime Minister Narendra Modi’s government is seeking to step up the pace of auctioning power-purchase contracts for wind-energy plants, building on a contest that reaped record-low prices for solar farms earlier this month.
The government plans to offer deals covering almost 4 gigawatts of wind capacity in the current fiscal year ending March 2018 in addition to 750 megawatts of solar capacity it will tender next month, Ashvini Kumar, managing director at Solar Energy Corp. of India, the country’s implementing agency for renewable targets, told reporters in New Delhi.
Modi is seeking to expand renewables to help balance India’s burgeoning needs for electricity against efforts to clear the skies of pollution. The government has a goal to install 175 gigawatts of renewable capacity by 2022 and is prodding local authorities to step up the pace of permitting renewables.
“The ministry of new and renewable energy has written to all states to indicate their requirement for green power to consolidate demand, as more tenders would be brought out,” Kumar said.
SECI, which conducted Asia’s first onshore wind auction in February, received bids to supply wind power for Rs3.46 (5 US cents) a kilowatt-hour, much lower than feed-in tariffs of Rs4 rupees to Rs5 prevailing across India’s most windy states.
According to Kumar, the government thinks that 5 gigawatts to 6 gigawatts of wind capacity can be added every fiscal, and companies could be able to reach the government’s goal over the next four years.
Modi’s goal calls for a doubling of India’s wind capacity to 60 gigawatts and a 10-fold increase in solar projects to 100 gigawatts.
SECI already has planned to offer 750 megawatts of solar projects next month in the sunny state of Rajasthan, anticipating that contest will bring record-low bids. The auction structure forces companies to compete for contracts to sell power from renewable energy plants, encouraging them to reduce prices.
The price of solar power in India fell to a record of Rs3.15 a kilowatt-hour last week in an auction for 250 megawatts earlier this month, besting February’s record of Rs3.30 a unit.
“The trend in the market should continue, and I would like to think that the market hasn’t bottomed out,” Kumar said when asked if tariffs in the upcoming project could go below the Rs3 mark.