Tuesday, March 18, 2014: The falling solar production cost has invited much interest in renewable energy production with Madhya Pradesh taking the lowest ever bid in India, made by Himgiri Energy Ventures. The bid stood at Rs 6.5 per unit cost of supply of solar power to the state grid. The amount is 13 per cent lower than the current market price of solar power. In the past three years, the price has dropped by 61 per cent.
This MP bid acceptance has reportedly brought down the price of solar energy power much closer to that of the price of thermal power, which is India’s largest energy source. For the year 2012-13, Delhi’s power utilities has projected to buy power at a price of Rs 5.71 per unit from conventional sources.
The solar power cost is merely 14 per cent above the thermal power, with advantages like life-time free fuel. According to an ET report, Sanjay Chakrabarti, partner (clean energy) at Ernst & Young said, “Price bids in conventional power have been up to Rs 5 per unit. Keeping that as the grid parity price, wind power has already achieved grid parity and solar is quite close.”
The ministry of new and renewable energy (MNRE) is aiming the grid equivalence by 2017, which is five years in the lead of its initial aim of 2022. The government of India (GOI) targets to increase solar power capacity to 22,000 MW by the year 2022, via the Jawaharlal Nehru National Solar Mission, JNNSM.
The second phase of the JNNSM, from 2013 to 2017, set the tariff at Rs 5.5 per unit. It is financially supported from GOI, in the form of viability gap funding.
