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July 7, 2019 by Saurabh
The financial and project implementation problems for Indian developers of renewable energy do not seem to stop, little or no solutions to existing problems and new problems to come.
We recently covered a story about several solar energy developers who have been waiting for payments for the energy generated by their power stations over the last few months in Telangana State. Nearly 200 solar energy project developers are expecting payments of US $ 300 million for the energy generated since July 2018. These developers were facing significant financial difficulties and the threat of their projects being declared. non-performing assets and the ratings of their parent companies are degraded. 
A similar situation has now developed in the state of northwestern Rajasthan. This time, late payments put a strain on wind energy project proponents. Public utilities in this state have not paid at least US $ 122 million to wind project developers since last September.
Although regulators have asked agencies to renew their power purchase agreements, they have not been renewed. However, utilities continue to supply energy to these wind projects and have not made any payments for the same. Utilities claim that the delay in payments to wind energy developers is explained by the fact that they do not have sufficient funds.
Indian News Agency recently reported that a 600 megawatt solar photovoltaic project planned in the state of Andhra Pradesh, in the south of the country, is uncertain. The project was to be implemented by one of India's leading solar energy companies, Acme Solar Holdings. The project was awarded to the company, following a competitive auction, at a rate of 2.59 Rs / kWh (3.78 USD / kWh) last year.
According to reports, NTPC Limited, the company that organized the competitive auction and awarded a capacity of 2 gigawatts to several major developers in the solar energy sector, was expected to enter into a contract to purchase Electricity with Acme Solar and an electricity sales contract with utilities in Andhra Pradesh. NTPC would not have succeeded in doing so. As a result, Acme sent a letter to NTPC stating that the plant was no longer financially viable and requesting the repayment of its bank guarantees.
It is interesting to note other aspects of the project and the competitive bid conducted by NTPC Limited. The Indian government has imposed safeguard rights on imported solar modules between the publication of the call for tenders and competitive bidding, which has caused considerable confusion among stakeholders.
NTPC had then clarified that if Acme were willing to absorb the additional financial impact of the safeguard duty, the project tariff would be Rs 2,59 / kWh (3,78US ยข / kWh), otherwise it would be reduced to 2 28 RK / kWh. (US $ 3.33 / kWh). A similar option was also presented to the other bidders. The reports do not specify whether Acme refused to support the financial impact of the backup right. However, it is significant to note that the lowest tariff proposal in India for a solar PV project was also submitted by Acme Solar Holdings at Rs.24 / kWh (US $ 3.56 / kWh) and is considered as highly competitive or even financially unsustainable by some. analysts.
The same media also quoted NTPC officials as saying that other project developers who have successfully won the 2 gigawatt bid should order their projects on time. However, while NTPC has not been successful in concluding electricity sales contracts with Andhra Pradesh utilities, it also seems highly unlikely that these projects will emerge.
Recently, the Ministry of New and Renewable Energy appointed a three-member committee Committee review and resolve such disputes regarding projects auctioned by SECI (Solar Energy Corporation of India) and NTPC Limited.
Image Credit: Cynthia Shahan
About the author
Saurabh A fervent supporter of the latest developments in the Indian renewable energy sector.
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