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Centre, 5 states to set up solar power projects

States to tie-up with the centre for solar power projects: Andhra Pradesh, Telangana, Gujarat, Rajasthan and Madhya Pradesh

Shreya Jai  |  New Delhi 

The Narendra Modi government has made the first concrete move towards expanding India's solar generation capacity.

Andhra Pradesh, Telangana, Gujarat, Rajasthan and Madhya Pradesh would soon tie up with the Centre to execute ultra mega solar power projects with more than 500-Mw capacity each.

To put at least 5,000-7,000-Mw solar power generation under operation as soon as possible, Power Minister Piyush Goyal has asked officials to ensure agreements are signed with interested states by the end of the month, a government official said.

Madhya Pradesh is eyeing 750 to 800 Mw, while Rajasthan is looking at developing 4,000 Mw. Andhra Pradesh is looking to add 1,000 Mw of solar power and it is likely that Union government-owned NTPC might take up this project. NTPC has 95 Mw of solar power projects.

"In the case of Madhya Pradesh, a special purpose vehicle (SPV) would be formed between the Centre and the state," said a senior official. "Private participation will be invited subsequently. The power evacuated would be sold to Solar Energy Corporation of India (SECI), which would take up the task of selling the power to the utilities." Telangana is also likely to sell solar power to SECI, wholly owned subsidiary of the ministry of new and renewable energy.

The project developers would bid for viability gap funding support from the Centre.

The price of solar power, if the SPV is formed, might be Rs 5.5-5.4 a unit, said an official who did not want to be named.

Tarun Kapoor, joint secretary, ministry of new and renewable energy, said the thrust was on large power projects. "The new government is pushing for big capacity addition in solar. Taking a cue from the Budget, the upcoming policies are likely to look at big projects in every possible corner of the country," said Kapoor.

Known to be a clean energy enthusiast, Prime Minister Modi is keen on development of renewable power. The Prime Minister's Office has decided to meet key officials of the energy and infrastructure departments every month, with special focus on developing clean energy.

Gujarat, when Modi was the chief minister, was the first mover in the renewable energy space with 860 Mw of solar power projects. It still is the largest contributor to India's solar power capacity of 2,600 Mw.

In the Budget, Rs 500 crore was allocated to develop solar ultra mega power projects. Under the flagship programme of the United Progressive Alliance-II, the Jawaharlal Nehru National Solar Mission, the target was to achieve 20,000 Mw of solar power by 2022. Renewable energy comprising solar, wind, biomass and small hydro currently accounts for 12% of the country's installed generation capacity.

First Published: Thu, August 07 2014. 00:44 IST