Solar power tariff falls to its all time low at Rs. 3.15 per unit

The levelised solar power tariff has fallen to all time low of Rs 3.15 per unit in an auction of 250 MW project at Kadapa in Andhra Pradesh.

Solardirect, the Indian subsidiary of french clean energy firm has won this project with quoted levelised tariff of Rs 3.15 per unit. Solariredirect Energy India Pvt. Ltd already has 182 MW of projects in India out of which 97 MW are in operation and 85MW under construction.

Levelised tariff indicates the average fixed and variable tariff over the entire term of the power purchase agreement.

In February, solar tariff had made a new low of Rs. 2.97 per unit for the first year in an auction for 750 MW capacity in Rewa Solar Park in Madhya Pradesh led by lower capital expenditure and availability of credit on cheaper rate. However, it was worked out at Rs. 3.30 per unit for 25 years.

Sector experts pointed out that sharp decline in the prices of solar panels, reduction in risk by better structuring of the projects and better currency hedging deals that make financing available at competitive cost have been the main reasons for low bids. 

Commenting on this Power Minister, Piyush Goyal on Tuesday tweeted, “Clean affordable power for all : Solar achieves another record low of Rs 3.15/ unit (flat rate) during auction in Kadapa, AP by NTPC.”

Last year in January, solar power tariff had clocked new low of Rs. 4.34 per unit for setting up 70 MW solar plant under  NTPC's Bhadla Solar Park tender.