Sun, Oct

Since “states are not very keen on purchasing” solar power even at the lowest price discovered of Rs 2.44 per unit (wind tariff are higher at Rs 2.76 per unit under latest auction), the country’s installed renewable energy capacity might get stranded, Union power minister RK Singh has warned. In a recent letter to finance minister Arun Jaitley, Singh wrote: “If any discom purchases renewable energy at Rs 2.44 per unit, then along with the fixed cost (which they will have to pay thermal stations under PPAs, whether or not electricity is lifted), the total cost per unit would come to Rs 4.04, which is higher than the average price (Rs 3.25/unit) which pay for thermal power.”

He added: “And renewable energy is intermittent… In such a situation, the achievement of renewable energy capacity of approximately 88,000 MW (71,300 MW established and 17,500 MW under construction) could only happen after constantly pursuing the states, but the states flatly refused (sic) to sign PPAs for renewable energy if the rates are any higher.”

The power minister also pointed out that the state-run Solar Energy Corporation of India (SECI), the intermediary for renewable energy projects, will have to shell out Rs 40 lakh/year each for every MW of renewable capacity sans PPAs over 25 years. Stating that “this is not a situation that SECI can afford”, Singh said, “Therefore, there is absolutely no question of SECI getting into a situation, where it accepts a bid and then cannot get the PPA signed by the states for the power at that rate.”

Meanwhile, reflecting the government’s continued focus on the sector, Prime Minister Narendra Modi will inaugurate three major renewable energy events here on October 2 — first assembly of International Solar Alliance, second Indian Ocean Rim Association’s Ministerial Meeting on renewable energy and the second edition of RE-INVEST 2018.

The states already have power purchase agreements (PPAs) with different thermal generating units for meeting their power requirements. The payment of thermal power is made by a two-part tariff structure — the fixed-cost per unit (average is about Rs 1.60/unit) and the variable-cost (approximately Rs 1.65/unit) —and the average unit cost of thermal power to be about Rs 3.25/unit.

About 4 gigawatts of recent solar bids have been scrapped due to high prices discovered, including a 1 gigawatt by Uttar Pradesh and a 500 mega watt by Gujarat. The problems could be exacerbated with the imposition of 25% safeguard duty on import of solar cells/modules, which is seen to make solar power more unattractive to states due to potential rise in prices. The ministry of new and renewable energy has clarified that rise in costs on account of the duty would be passed on in solar tariffs.

India has an ambitious target to increase its solar capacity to 100 giga watt by 2022 from 23 giga watt at present.

Read more: No takers for solar power? Power minister warns...

japan latest news, important news, trending news Merger and acquisition (M&A) deals involving Japanese companies, especially inbound transactions, are expected to accelerate as the country opens up to more foreign capital ahead of the Tokyo Olympics in 2020, they said. (Reuters)

Japan M&A volumes are set to break a 19-year-old record and steal the spotlight in Asia this year from cooling Chinese deals, led by blockbuster takeovers such as Takeda Pharma’s $62 billion swoop on British drugmaker Shire.Slowing growth at home and mountains of accumulated cash are pushing Japan Inc to scout for targets abroad in sectors spanning financials, consumer, industrials, renewable energy, technology and pharmaceuticals, bankers and lawyers said.
Merger and acquisition (M&A) deals involving Japanese companies, especially inbound transactions, are expected to accelerate as the country opens up to more foreign capital ahead of the Tokyo Olympics in 2020, they said.

Japanese firms were involved in a record $289.7 billion of deals in the first nine months of 2018, more than doubling from the same period last year and exceeding the previous all-time high of 1999, Thomson Reuters data showed. “Japanese corporates are now getting used to doing acquisitions and some managements have got more confidence in doing mega deals rather than small transactions,” said Tatsuhiko Kamiyama, a Tokyo-based partner at law firm Clifford Chance.
The hectic activity is helping the investment banking divisions of Western banks.

Morgan Stanley’s Japan venture with Mitsubishi UFJ retained top spot in the country’s ranking for the first three quarters, data showed. The U.S. bank also topped the Asia ex-Japan M&A league table, followed by UBS and Goldman Sachs. Japan Inc announced total deals of $242.2 billion in 1999 after the country relaxed its anti-monopoly law, introduced the stock swap system and launched tax benefits that favoured takeover activities.
Two decades later, Japan is again planning structural reforms to boost its growth amid a super-loose monetary policy and mass fiscal spending that have led to cheap funding costs and more shareholder accountability for corporates.

In the past quarter, a unit of Mitsubishi Chemical agreed to acquire Praxair’s European assets for 5 billion euros and Renesas Electronics struck a deal to buy Integrated Data Technology Inc for $6.7 billion. For the first time since 2014, Japan’s outbound M&A value, at $146 billion as of Sept 26, exceeded that of China’s, as dealmaking remains challenged in the world’s No.2 economy due to a tougher regulatory environment, funding constraints and yuan depreciation amid an ongoing Sino-U.S. trade war.

“Conclusion by Japan Inc is that local growth will be challenging to come by, and therefore an international strategy will be an important long-term requirement,” said Rohit Chatterji, JPMorgan’s co-head of Asia-Pacific M&A.

OLYMPICS BOOS Chinese firms announced $92 billion in outbound deals for the first three quarters, down 8 percent year-on-year. Chinese companies still attracted the most buyers in the region, with deal values involving a Chinese target slipping 1.3 percent to $352 billion. Investments into India and Australia also surged due to a few mega deals, including Walmart’s $16 billion acquisition of Indian e-commerce company Flipkart and a $9.5 billion takeover of Australia’s APA Group by a consortium led by Hong Kong’s CK Infrastructure Holdings.

Overall, the value of deals involving Asia Pacific companies hit $1.1 trillion in the first three quarters of 2018, still a record, the data showed.
“In deal volume terms it has not been a standout year for Asia (excluding Japan) but the activity has been quite balanced across the board in terms of sectors and geographies,” said James Tam, head of M&A, Asia Pacific at Morgan Stanley. China’s deleveraging drive is also providing opportunities for Japanese companies.
Last month, Orix Corp struck a $2.2 billion deal to buy a 30 percent stake in aircraft lessor Avolon holdings as its cash-strapped parent HNA Group trims holdings in its core assets.

“China’s aggressive M&A push into the overseas markets is slowing, and that’s good for the other companies in the region, in particular Japanese companies,” said Mayooran Elalingam, head of M&A, Asia Pacific, at Deutsche Bank. Dealmakers are counting on the 2020 Tokyo Olympic Games to give inbound investments a further boost.
“2020 Olympics and the approval of integrated resorts are huge drivers for Japan … Hotels, tourism, casino, power sectors are expected to see more deals happening,” said Lisa Christoffers Yano, a Tokyo-based partner at Hogan Lovells.

Read more: Japan Inc’s global push drives Asia M&As,...

Uttarakhand, trivendra Singh Rawat, investment proposals for Uttarakhand , Uttarakhand Investors Summit 2018 “Destination Uttarakhand: Investors Summit 2018”, to be held here on October 7-8, will herald the beginning of a new era for the state in terms of investments, he said. (IE)

Investment proposals worth Rs 74,000 crore have been received by the Uttarakhand government and memorandum of understanding (MoUs) to the tune of Rs 60,000 crore signed with firms ahead of an investors’ summit to be held here next month, Chief Minister Trivendra Singh Rawat said Friday. Attributing the huge volume of investments coming to the state to a sustained campaign conducted by his government to generate interest among entrepreneurs, the chief minister said it was much more than what was initially expected.

“MoUs worth Rs 40,000 crore only were expected initially but the road shows held by the state government in the run up to the forthcoming investors’ summit elicited  a great response from entrepreneurs. The result is that till now investment proposals worth Rs 74,000 crore in the state have been received and MoUs to the tune of Rs 60,000 crore have been signed,” Rawat said at a programme to unveil nine policies prepared by different departments to boost investments in the state.

“Destination Uttarakhand: Investors Summit 2018”, to be held here on October 7-8, will herald the beginning of a new era for the state in terms of investments, he said. Describing the development of hill areas as the priority of the state government, he said investments in solar energy, food processing, herbal, organic, Ayush and tourism sectors in which entrepreneurs have shown great interest will primarily benefit the people of hill areas.

The nine policies unveiled Friday to encourage investments include Mega Industrial Investment & Employment Promotion Policy 2018, Uttarakhand Solar Energy Policy, Uttarakhand Ayush Policy 2018, Biotechnology Policy 2018-23, Power Generation from Pirul and other types of Biomass Policy-2018, Uttarakhand Aroma Policy 2018, for establishment of Optical Fiber and Mobile Tower Guidelines Policy, Uttarakhand Electric Vehicle Manufacturing E.V.

Usage Promotion and Related Services Infrastructure Policy 2018 and Uttarakhand Tourism Policy 2018. Local people will be given projects up to 5 MW on priority as per Uttarakhand Solar Energy policy.

Power Generation from Pirul and other types of Biomass Policy-2018 will be important for the livelihood of people of hill areas, Rawat said. The chief minister said the policies were formulated incorporating suggestions made by entrepreneurs and business leaders at the road shows and after an in-depth study of the investment promotion policies of other states.

Read more: Uttarakhand receives investment proposals worth...

solar energy, solar scheme The original deadline was August 20 and there were three extensions earlier.(Reuters)

The Solar Energy Corporation of India (SECI) has extended the deadline for receiving bids for the government’s manufacturing-linked solar scheme to October 12. A senior SECI official told FE that the postponement was done “on the request of few bidders”.

The original deadline was August 20 and there were three extensions earlier.

Through the scheme, as much as 3 GW of cumulative annual solar manufacturing units are seen to be set up over three years, resulting in 10 GW of new generating capacities.
The scheme was introduced to boost domestic solar manufacturing, where developers would be provided with assured power purchase agreements (PPA) against the capacity of solar module manufacturing plant they set up in the country.

“The scheme’s terms and conditions do not apportion the risks appropriately and we have asked SECI to look into these aspects,” an official from a potential bidder said on conditions of anonymity. “It would be difficult to source financing for the scheme because it is more difficult to get funding for setting up solar manufacturing plant, compared with solar development projects,” the person added.

To make the scheme attractive to developers, SECI has already eased a number of norms for firms potentially participating in the bids. Under the new amendments, the amount of bank guarantee to be submitted by the developers have been reduced by almost 25% to Rs 466 crore. The ceiling tariff for the auctions has also been cut to Rs 2.75/unit, instead of the Rs 2.93/unit set earlier. A single bidder can now bid for a minimum 600 MW manufacturing capacity, instead of 1 GW mandated earlier, to win 2 GW of solar power supply contracts.

SECI is currently discussing the scheme with the state authorities of Chhattisgarh, Andhra Pradesh, Karnataka and Uttar Pradesh. As FE reported earlier, as many as 29 companies participated in the pre-bid meeting for the scheme held in June. Participants of the meeting included representatives from Adani Green Energy, SoftBank Group’s SB Energy and global solar giant GCL.

To boost domestic manufacturing of solar component, the government has levied a 25% safeguard duty on import of solar cells — the basic ingredient needed to manufacture solar panels — for a year, ending July 19, 2019. Solar developers, who source 88% of the products though cheaper imported component, have expressed their fears of rising project cost amid the lack of inadequate domestic production capacity.

Read more: Manufacturing-linked solar scheme: Bids deadline...

seci, latest news, important news, trending news, news today, news now, solar energy, It was a tariff based competitive bidding followed by e-Reverse Auction.

State-run Solar Energy Corporation of India (SECI) got poor response to its tender for 5GW/year solar manufacturing here as only one bidder Azure Power turned up for the auction on Thursday. The SECI being the nodal agency of the government had invited bids for selection of solar power developers for setting up of 5GW (Per Annum) solar manufacturing plant linked with power purchase agreements (PPAs) for ISTS (Inter State Transmission System) connected Solar PV Power Plant.

“The auction for the solar manufacturing of 5GW capacity got poor response as only one bidder Azure Power turned up for bidding today,” a source said. As part of the government’s targets of achieving a cumulative capacity of 100 GW Solar PV installation by 2022, the SECI had invited bids from developers. It was a tariff based competitive bidding followed by e-Reverse Auction.

As per the tender document, the bidders were allowed to bid for a minimum capacity of 1GW of manufacturing linked to 2GW of assured off take of power. However, the bidders were free to bid for the entire 5GW manufacturing, linked to 10GW Power Plant for which assured offtake was given. The slab for bidding was 1GW each and capacity(ies) was to be allocated on bucket filling basis. The SECI was to enter into PPA with successful developers for a period of 25 years. The maximum tariff was capped at Rs 2.93/unit for 25 years.

Read more: SECI’s auction for 5GW solar manufacturing gets...

solar, solar energy Indian companies are currently working to implement the government’s plan of commissioning at least 10,000 renewable energy-based micro- and mini-grid projects with a total capacity of 500 MW by 2022.

Indian companies can use their experience of setting up off-grid solar power plants in the country to emulate the same in Africa through the International Solar Alliance (ISA), power minister RK Singh said.

Speaking to FE about the first assembly of the ISA to be held from October 2 to 5, he said: “Many government representatives from Africa have expressed their interest in partnering with us to use solar technology for larger energy access.” The minister added that to enthuse companies to participate in Africa, the World Bank has mobilised $1 billion on a common risk-mitigation mechanism for solar projects through ISA.

Indian companies are currently working to implement the government’s plan of commissioning at least 10,000 renewable energy-based micro- and mini-grid projects with a total capacity of 500 MW by 2022. Growing at a CAGR of 17%, the global micro-grid market is expected to be worth $17.5 billion by 2025, research firms have pointed out. Villages in far-flung areas for which the costs of a grid-connected network are prohibitive, are setting up microgrids to meet their power needs in India. Similar situations exist in Africa and the Indian model can be replicated there, Singh said.

Three major events on renewable energy are coming up in the first week of October in the national capital: The first assembly of the International Solar Alliance, the second Indian Ocean Rim Association (IORA) renewable energy ministerial meeting, and the second global Renewable Energy Investment Meeting and Expo (REINVEST-2018). The three events will be inaugurated in a common function by Prime Minister Narendra Modi, in the presence of United Nations Secretary-General Antonio Guterres on October 2.

The ISA was launched jointly by Modi and Francois Hollande, then president of France, on November 30, 2015 in Paris, on the sidelines of the 21st Conference of Parties (CoP 21) to the United Nations Framework Convention on Climate Change.

“More than half of the 121 prospective member countries are already with us on ISA,” the minister said. Indian companies have already committed $7 million to ISA. Additionally Coal India and Power Finance Corporation are also expected to fund $1 million each in the organisation, while the India Trade Promotion Organisation would commit $2 million.

Read more: ISA can help Indian firms build solar projects...

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