According to this report by Bloomberg Businessweek, the CEO of NTPC Vidyut Vyapar Nigam Ltd (NVVN) Shri. A.K. Goyal has resigned and that the resignation could serve as a potential setback to the government program and the National Solar Mission itself.
NTPC Vidyut Vyapar Nigam Ltd. (NVVN) was formed by NTPC Ltd, as its wholly owned subsidiary to tap the potential of power trading in the country thereby promote optimum capacity utilization of generation and transmission assets in the country and act as a catalyst in development of a vibrant electricity market in India.
In order to facilitate grid connected solar power generation in the first phase of the Jawaharlal Nehru National Solar Mission, a mechanism of “bundling” relatively expensive solar power with power from the unallocated quota of the Government of India (Ministry of Power) generated at NTPC coal based stations, which is relatively cheaper, has been proposed by the Mission. This “bundled power” would be sold to the Distribution Utilities at the Central Electricity Regulatory Commission (CERC) determined prices.
The JNNSM also provides for NTPC’s Vidyut Vyapar Nigam Ltd to be the designated Nodal Agency for procuring the solar power by entering into a Power Purchase Agreement or PPA with Solar Power Generation Project Developers who will be setting up Solar Projects during the next three years, i.e., before March 2013 and are connected to the grid at a voltage level of 33 kV and above. For each MW of installed capacity of solar power for which a PPA is signed by NVVN, the Ministry of Power (MOP) shall allocate to NVVN an equivalent amount of MW capacity from the unallocated quota of NTPC coal based stations and NWN will supply this “bundled” power to the Distribution Utilities.
Bloomberg New Energy Finance lead analyst, Ashish Sethia, said in New Delhi, a couple of days ago in this report, “These are bad signs,” “Many large players have either not bid very aggressively or stayed away from bidding.”
Panchabuta in its report had mentioned that Lanco Infratech Ltd, KVK Energy and Infrastructure Pvt. Ltd and Anil Ambani-controlled Reliance Power Ltd’s (RPower), all participated and won the bids in the first phase of the mission.
Also Panchabuta comes to understand Mahindra Partners Division a division of Mahindra group has also participated and won the bid in the first phase.
Given the fact so many big players tha had participated and won bids it would be unfair to say that many large developers have not bid or stayed away from the Solar Mission.
This report states that, Tata Power Co., India’s largest non-state electricity developer, had said last week it was not participating in the auction, citing concerns including equipment import restrictions and aggressive bidding that may be underestimating the cost and complexity of setting up solar plants.
Apart from the reasons discussed above which are both valid and genuine, Tata Power could have also decided to stay away from the bidding due to the capacity restriction of 5MW for a group in Solar PV. Added to this is the fact that they were already planning to commission a 3MW PV plant at Mulshi in Maharashtra and set up two PV power plants with 25MW of capacity each at the site of its group company Tata Chemicals (TTCH IN) at Mithapur in Gujarat.
It has glad to note that, according to Bloomberg Businessweek report, NTPC said today in an e-mailed response to questions that “The Solar Mission project “shall not get affected in any way by this development.”
Panchabuta will follow the developments in NVVN closely and update its readers and we sincerely hope that this does not cause any setback as mentioned in the Bloomberg Businessweek report to the National Solar Mission which is the pride of India.