Andhra Pradesh Adjourns 6.4 GW Solar Tender, Goes with Purchase From SECI

Andhra Pradesh has abandoned a 6,400-MW (6.4 GW) solar tender in favour of purchasing from the Solar Energy Corporation of India (SECI) for Rs 2.49 per unit. 

The state government has dropped its revision appeal against a judgement issued by the Andhra Pradesh High Court on June 17 that rejected the tender, stating that requests for bids for renewable energy projects must follow the rules established by the Centre.

To illustrate a point about its allegation of paying too much for prior bids, the state administration attempted to pull off its own procurement with criteria different from central tenders. 

Even when mentioning the tender pipeline for solar projects, Power and MNRE Minister R.K. Singh did not include the Andhra government’s 6.4 GW offer at any point, indicating the centre’s position on the subject.

The ruling was issued in response to a case submitted in January by renewable energy businesses, including Tata Power, who claimed that the procurement procedure breached standards.

The state government informed the high court that it will drop its challenge against HC’s ruling by agreeing to buy power via SECI at Rs 2.49 per unit including SECI’s 7 paise trading margin.

The tender was published on November 31 last year by  Andhra Pradesh Energy Green Corp Ltd, APGECL, the nodal body founded by the Andhra government to administer the tender and its renewable initiatives, for 10 solar power plants producing 6,400 MW solely for agricultural usage.

Adani Green Energy and NTPC were awarded five mega solar power facilities totalling 600 MW at tariffs of Rs 2.47 and Rs 2.48 per unit, respectively. Torrent Power was granted 300 MW at a cost of Rs 2.47 per unit.

Andhra’s SECI acquisition has also provided a boost to SECI’s own dormant 12 GW manufacturing-linked bidding, which now has sufficient commitments and PSAs in place for it to sign its own PPA with the two winners, Adani Green Energy and Azure Power. 

As it turns out, both bid winners have to take a markdown on their winning offers in order for the process to move on.