Only half of India’s tendered 53 gigawatt (GW) solar power contracts are under construction, according to a JM Financial Institutional Securities Ltd report.
Mint earlier reported about falling clean-power tariffs putting already awarded solar and wind energy capacity in limbo. Fund-starved state electricity distribution companies (discoms) are unwilling to sign power supply agreements (PSAs) with intermediary procurers such as state-run Solar Energy Corporation of India (Seci) for these previously-awarded projects at a comparatively higher tariff.
“Discoms’ lag in signing PSAs stems from slow demand growth and falling solar tariffs, implying that the last to sign PSAs gets the cheapest power. However, we estimate 32GW of fresh PSA potential if all states meet their RPO (renewable purchase obligation) targets,” the report said.
This comes at a time when Chinese solar equipment suppliers are increasing solar module price to 25 cents per kWh from 19 cents per kWh.