Andhra Pradesh aiming for 1 GW of solar projects

Applicants have until February 7 to apply to be part of the scheme, which will be the first to feature an online bidding process, according to consultants Bridge to India.

The power generated will be sold to industry through 20-year PPAs at a rate determined by the successful bidders with the state paying for any surplus generation.

A possible deterrant is the state’s insistence that no more than 20 MW can be generated from each location, although developers can apply for an aggregate capacity of up to 200 MW.

The Andhra Pradesh procurement process will also be the first to feature financial incentives to encourage developers to get schemes up and running before their scheduled start date. Successful bidders will have seven months from signing PPAs to achieve financial closure and a year to commission photovoltaic plants.

Plants up and running 30-59 days ahead of schedule will earn developers INR100,000/MW (US$1,800), those commissioned 60-89 days early will earn INR200,000/MW and schemes running 90 days or more ahead of schedule will pocket INR300,000/MW.

The same figures will be applied as penalties to schemes which start behind schedule, according to the same time periods.

The state is applying a one-year lock-in, ensuring developers cannot sell a majority stake in their companies within a year of starting their schemes as commentators predict big international players will be acquiring Indian companies as a way of getting around domestic content requirements.

It is hoped the Andhra Pradesh scheme – managed by the Andhra Pradesh Power Transmission Company – will be more successful than the recent bidding in Tamil Nadu which saw only 499 MW of a hoped-for 1 GW of solar electricity commissioned.