The Indian state of Andhra Pradesh has announced a tariff of Rs. 6.49/kWh (US$0.120) for its 1GW tender issued in January.
However, following the warm reception which greeted Andhra Pradesh’s tender announcement, developers are now concerned that the state will follow the disappointing project allocation as experienced by the southern state of Tamil Nadu, according to analysts at consulting firm RESolve.
Indian module manufacturer and one of the bidders Surana Ventures told The Hindu newspaper that due to capital costs increasing by 15-20%, the tariff would not be cost competitive, said Narendra Surana, managing director.
The fervour surrounding Andhra Pradhesh’s tender was created by major players in the Indian market taking an interest such as Astonfield Renewables, Azure Power and Sunbourne.
A cumulative capacity of 1339.5MW has been bid for. The highest bid of 80MW came from Alfa Infra Properties followed by Lanco Solar at 60MW. The state has set a target of 1,000MW from this tender.
Developers will be given 30 days to respond to this proposal.