Karnataka halts new solar energy projects

Karnataka, India top state in terms of installed solar capacity, has stopped the building of new solar energy projects, a Livemint report said on Thursday. This was done in order to balance its renewable power purchase obligations and financial health of the power distribution companies (discoms).

Last month, the Karnataka Electricity Regulatory Commission said there will be no further bidding to procure solar energy from large-scale projects till further orders, Livemint said in its reported. The decision was communicated by the commission to the Karnataka Renewable Energy Development -- body that issues tenders for bulk renewable energy procurement for its discoms -- in a letter dated 7 March.

Mercom India in its report said, The commission also noted that at present, many discoms are defaulting on payments towards power supply by renewable energy generators due to cash flow constraints."

The commission, in the letter, observed that the state will have to restrict procurement from high-cost sources, given Karnataka power-surplus situation. It added that the discoms have already contracted to procure adequate power from solar energy sources, which has enabled them to meet their renewable purchase obligations not only for financial year 2019-2020 but for another couple of years as well.

Karnataka, with 2,800 Mw of solar projects in the development pipeline, is known for housing the Pavagada solar park in Tumkur district. The mega project is expected to house solar projects with about 2,000-Mw capacity at an investment of Rs 14,800 crore. Of this, over 600 Mw has already been commissioned. The state has a total installed renewable energy generation capacity of 13,577 Mw.