Realising the importance of solar power, Akhilesh Yadav, lead Uttar Pradesh government is now seeking private investments in the state for around 200 MW of solar power. The state is planning to offer competitive rates to the bidders who want to establish solar plants in 13 months’ time. All this comes with a condition to sell the solar power directly to the UP Power Corporation Ltd for 10 years.
The task of taking up ‘tariff-based competitive bidding’ has been entrusted to New and Renewable Energy Development Agency (NEDA). NEDA has to seek proposals for purchase of 200 MW power from solar photovoltaic projects, to be set up in the state.
It is worth mentioning here that the solar power generation capacity of the state is only around 13 MW. The average rate provided to purchase solar power through grid is around Rs 5. In the case of competitive bidding, the tariff at which the solar power will be provided to the state may be different as the companies will also take into account their investments in the state.
The UPPCL has plans to enter into a 10-year power purchase agreement with the firms offering the lowest tariffs. It is worth mentioning here that the states of Madhya Pradesh, Orissa and Tamil Nadu have adopted a similar model. However, Gujarat offers around Rs 15 per unit price for solar power while Rajasthan offers land as an incentive.
The UP government has decided that it will only bear the expenditure on the construction of transmission line and substation for projects that will come up in the Bundelkhand region. This cost has to be borne by the developer in the rest of the state.
