Solar energy bids: Dollar bids likely from applicants

Solar power contracts are likely to be placed on the winning bid rate in dollars, plus one cent a unit. It is the first time in the domestic power sector that the government would be looking at dollar rates.

“Foreign investors would also benefit when the rupee depreciates. The extra one cent would be collected as a fund, for paying investors when the dollar fluctuates,” said an official.

Currently, the petroleum sector has costs denominated in dollars, plus returns for oil and gas production and refinery operations, though the retail prices of products are calculated in the rupee. The ministry of new and renewable energy is designing a concept paper on dollar rate-based power purchase agreements (PPAs).

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