Solar developers had been anticipating the cancellation of the bids by the Uttar Pradesh government.

Stung by the high solar tariff of Rs 3.48 per unit at an auction for 1,000 MW, conducted by the Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA) a fortnight back, the state government has cancelled the auction and is going in for re-bidding.

The reverse auction for grid-connected solar projects conducted on July 10 saw participation from 13 companies. Mahoba Solar, an Adani group company, quoted the lowest tariff of Rs 3.48/kWh to develop 250 MW of projects. Maheshwari Mining & Energy (MMEPL) also quoted Rs 3.48/kWh to develop 20 MW. Other bidders included ACME Solar Holdings, which secured the largest capacity by bidding at Rs 3.54/kWh for 150 MW of solar PV projects, Feynman (Canadian Solar), Sukhbir Agro Energy, Rays Power Infra, EDEN Renewables, Azure Power and Hero Solar.

However, tariffs are much higher than in some of the recent auctions, including the latest tenders by Solar Energy Corporation of India (SECI), where the L1 bid quoted was Rs 2.44 per unit.

Speaking to FE, chairman of UPPCL Alok Kumar said the state government as well as the SECI feel that the tariff is very high, and so the UPNEDA should go in for re-bidding. “We think we can discover tariffs between `3.05 and rs 3.10/kWh,” he said, adding that final touches are being given to bid documents and that those would soon be uploaded.

It may be mentioned that solar developers had been anticipating the cancellation of the bids by the Uttar Pradesh government, and the National Solar Energy Federation of India (NSEFI), representing solar energy developers, has written to the state energy minister, requesting him to intervene and issue suitable directives to Uttar Pradesh Power Corporation to honour the tariff and the bidding process as cancellation of the auction might set a bad precedent.

“NSEFI has apprehension that the government of Uttar Pradesh may not honour the bidding process… even through a transparent bid process followed, which saw overwhelming participation,” the association’s letter to the state energy minister said, adding that there shouldn’t be any comparison as tariff varies from state to state based on various bid factors.