Discoms leave 16.8GW solar and wind projects in a bind

New Delhi: In what may impact India’s green economy and potentially dent its rules-based regime image, falling clean-power tariffs has put an already awarded 16.8 gigawatt (GW) solar and wind energy capacity in limbo, said two people aware of the development.

Fund-starved state electricity distribution companies (discoms) are unwilling to sign contracts with intermediary procurers such as state-run Solar Energy Corporation of India (SECI) for these previously-awarded projects at a comparatively higher tariff. Due to the recent low-price bids, the discoms are tariff-shopping and are reluctant to ink power supply agreements (PSAs) for these projects that involve a potential investment of around ₹60,000 crore.

India’s solar power tariffs hit a record low of ₹2.36 per unit during a bid conducted by SECI in June.