Older Solar Projects: Extend deadline if delay is on your part, says Centre to state govts

The Centre has asked state governments to extend the time duration for the completion of older solar projects if the delay is because of their own actions. This comes at a time when states like Uttar Pradesh and Jharkhand are planning to scrap older solar projects or are asking companies to lessen the tariff at which these older projects were signed.

“It is also to be clarified that if in a project, equipment/materials have been purchased ordered and substantial advances paid as per original completion date, and there is a delay on part of the state organisations regarding land, transmission or any such reasons, the extension of project may be allowed,” Dilip Nigam, adviser (National Solar Mission), Ministry of New and Renewable Energy, told the principal secretaries (power/energy) of each state government through a letter dated July 28, 2017.

Nigam added that if there are “any delays of any kind on the part of the state government authorities or public sector units like land allotment, transmission/evacuation facilities, connectivity permission or force majeure, the competent authority in the state/SECL (Solar Energy Corporation Limited)/ NTPC, etc, may consider providing extension of the time duration strictly as per the contractual agreement”.

Various state governments like Uttar Pradesh and Jharkhand — which have auctioned many solar projects at a high tariff in last three years — are planning to cancel those projects or asking the companies to match the current tariffs that are extremely low, government sources said.

The current low tariffs in solar projects are pushing the state governments to rethink the status of all older solar projects. For example, in December 2015, Uttar Pradesh signed various solar projects of total 215 MW capacity with the tariffs ranging between 7.02 per KWH and Rs 8.60 per KWH, while in May this year, a 200 MW solar park was auctioned in Rajasthan at a price of 2.44 KWH.

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