India's renewable energy industry calls for state-specific bids

The renewable energy (RE) industry called for state-specific RE bids to diversify generation beyond the five states accounting for nearly 70 per cent of capacity, while also advocating direct benefit transfers to consumers in place of subsidised electricity tariffs to reduce discom losses.

 

At the Confederation of Indian Industry (CII) Annual Business Summit today, Rajiv Ranjan Mishra, managing director, Apraava Energy said that the renewable generation and transmission has to be an all India affair instead of a 5 state affair otherwise transmission will always take longer to build.

 

He said the waiver for inter-state transmission system (ISTS) charges has resulted in developers inevitably opting for states with high irradiance and wind potential.

 

 

“Since all the renewables are going in specific states, all the transmission infrastructure is going there, exacerbating the issues of right of way, land price and lack of law and order to support the infrastructure,” he said.

 

Mishra also said state-specific bids will protect the grid from getting overwhelmed by minimising the irradiance and wind benefit.

 

“The problem is that we have not been looking at the entire system cost and just looking at the marginal generation cost,” he said.

 

He said that the governments have been unable to depolitise power tariffs and impose cost reflective tariffs without cross subsidies. “State governments can give as much subsidy as they want but they shouldn’t involve a private generator or distribution companies and instead transfer the amount directly to the bank account of consumers,” he added while also adding that there is absolutely no justification why it can be done for LPG—one form of energy—and not for electricity which is another form of energy.

 

Smart meters are a solution to many issues in the power sector and the use of its data should be made compulsory so that the ACS-ARR gap of discoms can be reduced further, Mishra said.

 

Speaking at the same event, Parag Sharma, CEO, Resolven and Wind Independent Power Producers Association (WIPPA) president also agreed to localised RE bidding and called for sub-station level bidding. “While planning of the entire 500 GW of renewable network was done by CEA assuming the resource centres are scattered, it didn’t come out that way which is why no one wants substation level bidding, everybody wants cheapest power. Substations like Dholera have a lot of land there but no takers just because power is 30–40 paise costlier there,” he said.

 

Sharma also said that the industry body has asked the government to waive off the ISTS charges for 42 GW of unsigned PPAs. “If this is done, half of the PPAs will get signed and discoms will have confidence,” he added.

 

He said that despite Renewable Energy Implementing Agencies (REIAs) issuing bids for 53 GW in 2023 and 71 GW in 2024 — which helped drive a record addition of more than 50 GW in the last fiscal year — the confidence of the Ministry of New and Renewable Energy and the Ministry of Power appears to have declined, with only 20 GW of bids being floated in 2025. This year again they have said that they will not call more than 20GW of bids because past PPAs are not signed, Sharma added.