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27 solar projects under India’s national solar mission achieve financial closure

According to reports, all but one of the 28 companies that won solar photo voltaic projects in the second round of bidding under the National Solar Mission have achieved financial closure, the nodal agency for the programme, NTPC Vidyut Vyapar Nigam Ltd (NVVN) disclosed on Wednesday.

The projects that will be put up by these companies will add up to 340 MW, which is a respectable capacity in the solar power sector. Roughly, Rs 3,000 crore will be invested in these projects.

Only one company – Sujana Towers – that had won a 10 MW project, and incidentally, the only project in Tamil Nadu, does not figure in the list of projects that have completed financial closure. No reason has been given.

These 340 MW worth of projects were won by these 27 companies last December in a tendering process of the Government of India, through the public sector NVVN. These companies had bid for projects of the size of their choice and the award was made on the basis of the price at which they offered to sell the power they would generate to NVVN.

This tendering process – Batch-II of the first phase of the National Solar Mission— made big news then because of the low tariffs quoted by the winners. A French-owned company, Solaire Direct, made new by quoting just Rs 7.49 a unit, raising hopes that solar power was reaching within reach of the common man.

Under Batch-I, power purchase agreements were signed for solar projects worth 610 MW were awarded. These included 470 MW of solar thermal projects and 140 MW of solar photo voltaic projects.

The Ministry of New and Renewable Energy announced last week that so far 257.5 MW of capacity has been commissioned so far under the schemes of Government of India, including the National Solar Mission.

The commissioned projects include 255 MW of photo voltaic and 2.5 MW of solar thermal. Of the 255 MW, 125 MW were of the 25 projects commissioned under Batch I, 82 MW rooftop plants and 48 MW of projects that were being put up under some fixed tariff-based schemes that were in vogue earlier and later ‘migrated’ to the National Solar Mission.

The 470 MW of solar thermal projects have to be completed by May 2013, or else they face penalties.

India recently achieved the milestone of having crossed 1 GW of solar capacity. As of the end of June, the country had solar capacity of 1,031 MW. Most of it, around 650 MW, came under a fixed tariff-based programme of the Government of Gujarat.

India has ambitions to reach a capacity of 22,000 MW by 2020, making the country one of the larger markets for the solar industry in the world.

The industry is eagerly awaiting the announcement of the policy relating to the Phase II of the National Solar Mission, which was originally scheduled to come in July.

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