Safeguard duty fallout: NTPC and MPUVNL delay solar auctions

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Explaining the 33 MW rooftop PV tender deferral, Manu Srivastava, Managing Director of Madhya Pradesh Urja Vikas Nigam Ltd (MPUVNL), told pv magazine, “We have received numerous requests from prospective bidders about postponing the last date for the Renewable Energy Services Company-mode tender, on account of the recent imposition of [a] safeguard duty, and the time needed to study the data of 577 sites available in the data room, and to fill 27 different tenders.”

“Our tender is actually a bouquet of 27 different tenders – one of government colleges, another of PGCIL [the Power Grid Corporation of India Limited projects], another of medical colleges etc – with different natures of project and potentially different winners in each. The tender specifies MNRE [Ministry of New and Renewable Energy] standards for panels and other equipment.”

NTPC – formerly the National Thermal Power Corporation Ltd – deferred its 2 GW interstate transmission system-connected solar auction after a representation by pre-qualified bidders about the impact of the recently imposed 25% safeguard duty on solar cell and module imports from China and Malaysia on its financial models. Developers estimate the duty will lead to a Rs0.30-0.40/kWh ($0.0044-0.0058/kWh) increase in electricity tariffs.

However industry analysts including TrendForce and IHS Markit feel even with duties, Chinese PV modules will be competitive in India.

Chinese modules in India cost around US$0.25/W before the safeguard duties came into effect, which is a 30% drop from the end of 2017. Safeguard duties raise prices to US$0.31/W, which is still 14% lower than eight months ago,” said IHS Markit analysts Dharmendra Kumar and Josefin Berg.