The Kerala government has agreed to buy 200 megawatts (MW) solar power from the 12,000 MW capacity being built under the manufacturing-linked solar scheme for which the Solar Energy Corporation of India (Seci) has been struggling to find buyers.

Under the scheme, the tariff is Rs 2.92 per unit, much higher than the tariffs discovered in subsequent auctions. Kerala’s offer marks the first instance of a state agreeing to procure power under the scheme.

Kerala’s power regulator has allowed the state-run power distribution company (discom) to buy electricity from the manufacturing-linked tender at a maximum tariff of Rs 2.66 per unit. The price differential is enabled by the bundling policy adopted by Seci to find buyers.

According to sources, Seci has initiated preliminary talks to sell power from the bundled capacity with Jammu and Kashmir, Odisha and Maharashtra as well.

To make the power more palatable for discoms, Seci is bundling 3,000 MW from the manufacturing-linked capacity auctioned in January, with 3,200 MW of solar projects awarded through competitive bids in February and June. Since the February and June auctions discovered lower prices of Rs  2.5 per unit and Rs 2.36 per unit respectively, the composite pooled tariff is Rs 2.66 per unit.

Source:- Financial Express