First Solar set to miss out in India PV auction

The financial bids followed a technical qualification round. Developers competed in the reverse-bid auction in two parts. Half the 750MW available had a mandatory domestic content requirement (DCR), and the other 375MW was left open with no domestic requirement.

The US filed a complaint to the World Trade Organisation earlier this month claiming that it should have equal access to the procurement round. First Solar has previously dominated the thin-film market via a loophole in previous JNNSM bids, now closed, which did not include thin -film modules under DCR. The company has worked with the US Export-Import Bank on a number of projects in India.

On the subject of the impact of the trade dispute, Bridge to India analyst Jasmeet Khurana said First Solar had missed out “only based on the bid submitted by them. There are no political considerations. India is not that investment unfriendly”.

The reverse-bid mechanism also included bids for viability gap funding (VGF), a government subsidy to provide up to 30% of JNNSM project costs. There is a cap of up to 50MW per developer for funding applications.

Under the non-DCR bid, 15 power purchase agreements (PPAs) are predicted to be signed  for 24 projects, totalling 375MW.

Under the DCR, another 15 PPAs are to be signed for 21 projects, totalling 375MW.

The lowest bid in the non-DCR VGF auction was for INR1.7 million (US$0.02 million), it was submitted by Gujarat Power Corporation Limited for a 10MW project.

The highest non-DCR bid was for INR24.9 million (US$0.4 million), bid by Madhav Infra also for 10MW.

The lowest under the DCR was for INR13.5 million (US$0.2 million), bid by Swelect for 10MW.

DCR highest bid: INR24.9 million (US$0.4 million), by developer, IL&FS Renewables also for 10MW.

Acme Power bid for 120MW of various solar developments – 60MW DCR and 60MW non-DCR.

Asure Power bid a total of 160MW, with 80MW under DCR and 80MW bid under the non-DCR.

Four bids were disqualified for not meeting the technical criteria, PMP Auto Components, Zandu Realty, Golden Crystal and Green Energy Wind. Moser Baer’s bid was cancelled because of funding uncertainty.

Unsurprisingly the top solar states, Gujarat and Rajasthan, are the most popular locations for solar projects.

VGF payments are estimated for non-DCR projects to cost INR4.02 billion (US$64.78 million)

Whereas the DCR bids are estimated to cost much more at INR7.49 billion (US$120 million).

The difference in government funding of INR3.47 billion (US$55.9 million), has sparked questions from analysts, such as Bridge to India, who asked in a statement earlier if funding should have “been given as direct funding for domestic manufacturing” instead. 

Bridge to India also speculated on the firms that would not win projects suggesting First Solar and Goldman Sachs-backed Renew Power would fall short. Welspun missed out with a bid that was just US$1,000 short.

Bridge to India predicts developers likely to receive tenders in the non-DCR segment are: Acme, SunEdison, Azure, Hero Future Energy and BELECTRIC.

Under the DCR, those likely to sign PPAs soon are: Tata, SunEdison, SolaireDirect, Azure Power, Waaree, IL&FS and Hero Future Energies.

Figures will not be final until PPAs are signed, which is predicted to happen in April.

This article was updated 24 February after Bridge to India corrected its previously misquoted figures.