Solar power tariffs dropped to a historic low in the state-run Solar Energy Corporation of India’s (SECI’s) latest auction for 1,070 MW of solar capacity to be set up in the Indian state of Rajasthan. The lowest tariff of Rs 2 per unit ($0.027 per unit) was quoted by Saudi Arabian firm Aljomaih Energy and Water Company and Singapore headquartered Sembcorp’s India arm’ Green Infra Wind Energy Ltd to win 200 MW and 400 MW of solar capacity respectively. At a quoted tariff of Rs 2.01 per unit, state run NTPC Limited emerged as the second-lowest bidder securing the balance 470 MW of solar capacity.

This record low tariff of Rs 2 per unit comes barely five months after India’s solar tariffs dropped to Rs 2.36 per unit in SECI’s auction for 2 GW of solar capacity in July 2020, the lowest tariff ever discovered in the country till then. This 15 per cent lower tariff comes at a time when the industry has been suffering due to the delays caused by the pandemic as well as non-payment of dues from discoms.

Interestingly, both the top bidders have foreign backing. This was the case in the previous 2 GW SECI auction (July 2020) as well. In this tender, Spain’s Solarpack Corporación Tecnológica, S.A emerged as the lowest bidder with a tariff of Rs 2.36 per unit and apart from ReNew Power, all other winners (Enel, Eden Renewables, Ibvogt, Ayana Renewable Power and Amp Energy) in this tender had foreign backing.