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Solar mission --> Debt Problem (CHALLENGES BY SOLAR POWER IN INDIA…
Solar mission --> Debt Problem
ISSUE
SC did not allow change in Tariff Charged by Tata Power Co ltd and Adani Power Ltd for 4000 MW and 4620 MW Ultra mega power projects(UMPP's) based on coal price rise
in 2016, Bidding for UMPP's attracted bid tariff as low as Rs1.19 and Rs 2.26 --> But only few commissioned
Reason fro failure : When bid submitted coal prices were low, but no provision for revision of tariffs based on coal prices in 25 years tenure
CHALLENGES BY SOLAR POWER IN INDIA
Purchase power agreement for 25 years without escalation clause
Internationally electricity cost of Solar : Rs9/KWH
Coal : Rs 4.8 /KWH
With increase in R&D by 50%, in 2030 solar cost " Rs 4.43 KWH
In India Solar power Bid : Rs 3.15/KWH . Why?
Import from China, $2.34 B(83%)
China dumps cheap thin film solar to capture India market in absence of Anti dumping duty.
No production of raw material or panel in India
Complete reliance on china risk such as currency fluctuation and China solar panel policy.
Policy of Sealed bid price auction results into winners curse
WHAT NEEDS TO BE DONE?
Dynamic Auction Format
In 2000 commodity boom, power companies participated leading to NPA issue
Government should restrain influence in such circumstances and focus on good public bank governance
Clause for periodic review of purchase agreements, even in fixed term there should be an escalation clause
In absence of proper measures thermal power scenario will repeat for solar power
Government's ambitious goal to add 60GW grid connected power plants out of total addition 100GW by 2022 needs careful policies