Lower radiation to take away Odisha's edge as solar power hub

State may not be able to match tariff rates which hit a low of Rs 2.44 a unit for Bhadla solar park

Lower solar irradiation may impede the prospects of Odisha to match solar tariff rates which have plunged to a new low of Rs 2.44 per unit in the recent auction conducted for Bhadla solar park in Rajasthan.

Odisha receives an average solar radiation of 5.5 kWh/square meter area with an average CUF (Capacity Utilisation Factor) ranging from 15-17 per cent across the districts and around 300 clear sunny days every year while in Rajasthan, it goes beyond seven. States like Madhya Pradesh, Maharashtra and Andhra Pardesh also receives more sunlight than Odisha.

"The lower irradiation is a serious impediment for the state to match the tariff rates quoted in Rajasthan or other states. The state may miss the opportunities in the solar sector if special and lucrative measures are not taken by the state and centre to attract investors in the sector", said an official in the energy department.

The tariff rate quoted at Rs 2.44 per unit in Rajasthan is not feasible in Odisha. Gridco, the bulk power is not keen to purchase the solar power at a higher rate as cheaper power is available in other states, he added.

The tariff rates in Odisha can be quoted in the range of Rs 3.75 to Rs 3.8 per unit and cannot plunge further.

Odisha has a total installed capacity of 77 Mw solar power in the state. It may be noted that the state government, in its newly approved Renewable Energy Policy-2016, plans to add a capacity 2200 Mw of solar energy by 2022. As per estimates by KPMG, this needs an investment of Rs 13500 crore. The state government plans to develop a mega solar park of 1000 Mw under a scheme approved by the Union ministry of new & renewable energy (MNRE) on the public private partnership (PPP) mode. . The park has the potential to draw investments of the order of around Rs 5000 crore.

Industry experts say while Rajasthan has an exclusive solar policy, the Odisha government has come out with a policy for the entire renewable sector which lacks clarity for the investors in the solar sector.

"States like Madhya Pradesh, Maharashtra Rajasthan has waived off VAT and entry tax on solar components which reduces the project cost by about six per cent. While VAT and entry tax are levied on components used for the generation of solar power in Odisha. The government of should initiate steps for removal of the levies", said Swayam Prakash Baral, director at Canyon Consultancy, a Bhubaneswar-based renewable energy consultancy firm.