Raj Kumar Singh, India’s minister for power and new and renewable energy said that 20 gigawatts each of wind and solar power contracts will be auctioned to boost India’s capacity to manufacture equipment, such as solar modules, or panels, which account for nearly 60% of a solar power project’s cost. Most solar power developers in India source solar modules and equipment from countries such as China, where prices are lower. But due to this, Indian manufacturers account for only about 10% of the market despite India having an ambitious 175 GW clean energy target by 2022, of which 100 GW is projected from solar projects.
The Government of India plans to award contracts to developers who quote the lowest price at which they will sell electricity in the auction process for the grid-linked capacity. The projects are expected to be commissioned in phases, reports Live Mint.
“It is a great move. Bidding pipeline has gone dry for quite some time and this is very much welcome. This reinforces the government’s commitment to solar… I would also hope that issues related to land acquisition, electricity evacuation and power purchase agreements are simultaneously addressed,” said Sanjay Aggarwal, managing director at Fortum India Pvt. Ltd.
