Tata Power Renewable Energy wins Gujarat solar auction

India largest generator Tata Power subsidiary, Tata PowerNSE -0.08 % Renewable Energy Ltd, emerged winner in an auction conducted by Gujarat for 1000 MW of projects to be built at Dholera solar park. 

Tata Power and state-owned Gujarat Industries Power Company Ltd (GIPCL) were the only bidders who bid for 250MW and 50MW respectively at a tariff of Rs 2.75 per unit. Tata Power was chosen as the winner through draw of lots since Gujarat Urja Vikas Nigam Limited (GUVNL) will be allotting only 250MW.

Bid for the tender was invited three times but there were no takers in the first two rounds. Developers remained subdued because the ceiling tariff was set at Rs 2.75 per unit, which in their opinion, was unviable and the discom was unwilling to move it up any further. 

Power companies felt it was unrealistic because of challenges with the terrain due to which construction costs are expected to be on the higher side. 

A GUVNL executive confirmed the results of the auction.

Developers have turned reluctant to auctions conducted by Gujarat because it had, earlier this year, cancelled the results of a solar auction held for 700MW of projects to be constructed at Raghanesda solar park because the state felt tariffs quoted were too high. The auction was conducted again for the second time last month. Earlier, it also cancelled a 500 MW auction held in March last year at which the lowest price reached was Rs 2.98 per unit.