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Ministry of New & Renewable Energy (MNRE) has taken a decision in principle to stop e-reverse auction of wind energy projects in the country in view of the industry demand. A formal decision in this regard will be taken shortly.
Indu Shekhar chaturvedi, secretary to the new and renewable energy ministry (MNRE), announced that the government will stop the electronic reverse auction for Wind power projects. He stated that the government’s procurement system will shift towards state-specific bids to allow tariffs to be pooled.
Sources claim that the ministry would also remove e-reverse auctions of other renewable projects because it has in principle agreed to the industry’s claims about unhealthy competition.
The government was asked by the renewable energy industry to end the e-reverse bidding. They claimed it caused intense competition and a sharp fall in tariffs which could make some projects financially unviable.
“I can confidently say that the reverse auction arrangement is now decided to be terminated; a formal decision shall follow soon,” Chaturvedi stated at the Confederation of Indian Industry (CII) ‘India @2030 – A Roadmap for Atma Nirbhar Bharat Renewable Energy’ conference.
At COP26 in Glasgow, 2021, Prime Minister NarendraModi increased India’s target for renewable energy to 500 gigawatts by 2030, from 450 GW. India will need to add an average of 42 GW a year for the next eight years to meet the revised target.
He also said that we must realize that these targets will require action that is out of the ordinary. Chaturvedi stated that although the public policy was supportive, it would be more proactive in the future.
All our RE capacity increases today come from the private sector. The government does not have to make additional efforts to attract investment. Investment has flowed naturally. This is due to the strength and bankability of projects, as well as the strength of private sector. He said that we have a solid contractual framework.
Chaturvedi stated that the industry needed to reach a political consensus in order to ensure reliable and consistent energy supply. This might prove costly in the short-term due the high cost of battery storage, but it would be crucial in the long-term.
