Concerned over the lackluster pace of capacity addition in the solar power sector, the Indian government has made amendments to the auction and project implementation timelines. The recent amendments to the policies would result in much quicker implementation of large-scale solar power projects, giving hope to the government that the 2022 target of 100 gigawatts solar power capacity will be realized.
According to a notification issued by the Ministry of Power, the number of days designated for completion of various steps involved in the tendering and auction process of large-scale solar power projects have been reduced by eight to ten days. Earlier, a project would have to be awarded to project developers within 120 days after issuance of the tender document, and this timeline has been reduced to 110 days. Similarly, a power purchase agreement would have had to be signed within 150 days after the issuance of the tender documents, and this has been reduced to 140 days.
As per previous regulations, developers had 12 months to achieve financial closure. The government has now reduced this time period to 9 months for projects located within solar parks, whereas projects to be implemented outside solar parks will continue to have the same time period to achieve financial closure.
To commission the projects, developers earlier had a period of 21 months, and 24 months, if the project is more than 250 megawatts capacity and located outside a solar park. In the amended regulations, the reference to the project capacity has been removed. Developers setting up projects within a solar park will now have 15 months to fully implement their projects, while for other projects, developers have been given a timeline of 18 months.
The government has been forced to issue this notification, and modify the implementation schedule right from the issuance of tenders to final commissioning of projects due to the recent delays, cancellation, and annulment of tenders and schemes.
The Solar Energy Corporation of India (SECI) had to annul 2.4 of 3 gigawatts capacity awarded through an auction last year. The Minister of New and Renewable Energy announced the cancelation of a scheme where 12 gigawatts of capacity was to be auctioned for power supply bundled with power generated from coal-based power plants. Several other tenders, including one linked to the development of solar manufacturing facilities, have been delayed and reduced in size.