NHPC Signs Power Sale Agreements for 1.7 GW of Solar Projects

The capacity is part of its 2 GW solar tender floated last year

September 30, 2020


NHPC announced that it entered a power sale agreement (PSA) with Chhattisgarh State Power Distribution Company Ltd. (CSPDCL) for the supply of 400 MW of solar power.

The tariff decided under this agreement is ₹2.55 (~$0.035)/kWh for 25 years. NHPC would also earn a trading margin at ₹0.07 (~$0.00095)/kWh during the contract period.

This capacity is part of NHPC’s 2 GW Interstate Transmission System (ISTS) solar projects auctioned in April 2020. SoftBank, Axis Energy Ventures India Private Limited, O2 Power, EDEN Renewables, and Avaada Energy were the winners in this auction. Softbank, Axis Energy, O2 Power, and EDEN quoted the lowest tariff of ₹2.55 (~$0.0335)/kWh in the auction. They were awarded 600 MW, 400 MW, 380 MW, and 300 MW, respectively. Avaada Energy, who had placed bids for 600 MW, was awarded 320 MW at a tariff of ₹2.56 (~$0.0337)/kWh.

NHPC had initially floated this tender in September 2019 with a ceiling tariff of ₹2.95 ($0.041)/kWh. But later, in October 2019, the tariff cap was revised to ₹2.65 ($0.037)/kWh. In January 2020, it again revised the minimum tariff payable to ₹2.78 (~$0.036)/kWh.

The tender received a huge response from developers and was oversubscribed. NHPC received bids from nine developers for a total of 3.78 GW against the 2 GW capacity floated.

According to NHPC’s statement, the public sector undertaking has so far signed the PSAs for the supply of 1.7 GW of solar power out of the total 2 GW capacity floated.

In August 2020, NHPC had also signed a PSA with Madhya Pradesh Power Management Company Limited (MPPMCL) for the procurement of 1,000 MW solar power and for 300 MW with Jammu & Kashmir Power Corporation Limited (JKPCL). It added that the PSA for the remaining 300 MW would soon be signed with Punjab State Power Corporation Limited.

According to Mercom India Solar Project Tracker, NHPC has 50 MW solar projects in-operation in Tamil Nadu.

Rahul is a staff reporter at Mercom India. Before entering the world of renewables, Rahul was head of the Gujarat bureau for The Quint. He has also worked for DNA Ahmedabad and Ahmedabad Mirror. Hailing from a banking and finance background, Rahul has also worked for JP Morgan Chase and State Bank of India. More articles from Rahul Nair.