Andhra Pradesh finalises tenders for 6,400mw solar power plants across 10 parks

On Thursday, the Andhra Pradesh government has finalised the tender for the development of 6,400 MW mega solar power plant across 10 parks. The aim of the government is to reduce the subsidy burden resulting from the supply of uninterrupted free power to farmers. The four parks are coming up in Kadapah district, three in Anantapur, two in Prakasam and one in Kurnool.

This process resulted the government in securing close to 14,000 million units of power per annum at a tariff of 2.48 per kWh, which is lower than the tariff at which AP Distribution Utilities are procuring power. However, this involves a huge subsidy burden on the state government, but the supply of free power to farmers is of paramount importance. To meet the revenue gap of distribution utilities, the state has to incur close to Rs. 10,000 crores.

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The concern is the burden of the PPAs executed by the previous TDP government at exorbitant tariffs. The average power procurement cost of the state as of now is close to Rs. 5.2 per kWh. Therefore, the YSRC government has formulated an approach to procure power from the proposed solar projects. By making the functioning of the sector sustainable, this would ensure reliable daytime power to the farmers and also reduce the subsidy burden on the government 

The low tariff of Rs. 2.48 would result in a savings of nearly Rs. 3,800 crores in the very first year and this savings is likely to increase over the years. The present tariff of 2.48 for the energy from the 6,400 MW solar power project would remain constant over the next 30 years. 

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State's Exchequer a Whopping 50,000 crore

The present benefit accruing to AP government exchequer over the life of this project can be estimated at Rs 50,000 crore. Big players such as NTPC Adani group and Torrent power placing has filed the tender and bids to develop the project. The first stretches over 10 different locations have attracted a total of 24 bids in all. 

10 Solar power parks with tariffs

The authorities have adhered to all the guidelines prescribed by the Ministry of New and Renewable energy in an attempt to make the process as transparent and objective as possible, unlike never before. The transparent manner of processing the bids along with the reverse tendering mechanism has ensured the discovery of the low tariff. The tariffs discovered of the 10 Solar parks are as follows:

1. Chakrayapet Ultra Mega Solar Park, Chakrayapet Mandal, YSR Kadapa District
L1 Bidder(s)- NTPC Limited
Bid Capacity (MW)- 600
Capacity Won (MW)- 600
Final Tariff (INR/kWh)- 2.48

2. Thondur Ultra Mega Solar Park, Thondur Mandal, YSR Kadapa District
L1 Bidder(s)- Shirdi Sai Electricals Limited
Bid Capacity (MW)- 400
Capacity Won (MW)- 400
Final Tariff (INR/kWh)- 2.49

3. M.Kambaladinne Ultra Mega Solar Park, Mylavaram Mandal, YSR Kadapa District
L1 Bidder(s)- Adani Renewable Energy Holding Twelve Limited
Bid Capacity (MW)- 600
Capacity Won (MW)- 600
Final Tariff (INR/kWh)- 2.49

4. Pendlimarri Ultra Mega Solar Park, Pendlimarri Mandal, YSR Kadapa District,
L1 Bidder(s)-  Adani Renewable Energy Holding Twelve Limited
Bid Capacity (MW)- 600
Capacity Won (MW)- 600
Final Tariff (INR/kWh)- 2.49

5. Rudrasamudram Ultra Mega Solar Park, Donakonda Mandal, Prakasam District
L1 Bidder(s)- Adani Renewable Energy Holding Twelve Limited
Bid Capacity (MW)- 600
Capacity Won (MW)- 600
Final Tariff (INR/kWh)- 2.49

5. CS Puram Ultra Mega Solar Park, CS Puram Mandal, Prakasam District
L1 Bidder(s)- Adani Renewable Energy Holding Twelve Limited
Bid Capacity (MW)- 600
Capacity Won (MW)- 600
Final Tariff (INR/kWh)- 2.58

6. Uruchintala Ultra Mega Solar Park, Tadipatri Mandal, Anantapuram District
L1 Bidder(s)- Torrent Power Limited
Bid Capacity (MW)- 600
Capacity Won (MW)- 600
Final Tariff (INR/kWh)- 2.47

7. L1 Bidder(s)- Shirdi Sai Electricals Limited
Bid Capacity (MW)- 300
Capacity Won (MW)- 300
Final Tariff (INR/kWh)- 2.48

8. L1 Bidder(s)- HES Infra Private Limited
Bid Capacity (MW)- 600
Capacity Won (MW)- 300
Final Tariff (INR/kWh)- 2.49

9. Mudigubba Ultra Mega Solar Park, Mudigubba Mandal, Anantapuram District
L1 Bidder(s)- Adani Renewable Energy Holding Twelve Limited
Bid Capacity (MW)- 600
Capacity Won (MW)- 600
Final Tariff (INR/kWh)- 2.49

10. Kolimigundla Ultra Mega Solar Park, Kolimigundla Mandal, Kurnool District
L1 Bidder(s)- Shirdi Sai Electricals Limited
Bid Capacity (MW)- 600
Capacity Won (MW)- 600
Final Tariff (INR/kWh)- 2.48

During the period 2014-19, the debt in the sector has risen from Rs. 33,500 crores to Rs. 70,250 crores, the total payables of the sector have risen from Rs. 2,893 crores to Rs. 21,500 crores during the five year period. The negative net worth of both the distribution utilities was to the tune of Rs. 19,920 crores on March 31,2019.

Previously, the TDP Government executed contracts with companies, to procure power at tariffs going way beyond Rs. 5 per kWh, when the prevailing cost of thermal power was around Rs. 4 per kWh. Therefore, the distribution utilities were forced to replace low-cost power with high-cost power. Unlike the previous government, the present government focuses on safeguarding state resources in the process. Also committed to execute agreements for procuring power at tariffs significantly lower than the current prevailing thermal cost of around Rs. 5 per kWh.

The proposed solar power plants will strengthen the rural economy and improve the living standards of farmers by providing energy to the agricultural sector which consumes up to 30 per cent of the total power consumption. 

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