BHOPAL: Country's biggest solar power plant to generate 130 MW electricity would be set up in Neemuch in Madhya Pradesh. The ambitious project cleared by departmental advisory committee of the State department New and Renewable Energy, according to press release here on Tuesday.

1,000 acre land has been earmarked for the plant in Neemuch district. Renewable energy accounts for just five per cent in total energy generation in Madhya Pradesh. At present, work is underway for 311 MW solar power projects in the state.

Lanco Infratech Ltd. (LANCI), India’s second-biggest non-state power generator, is seeking private- equity investors to help expand its solar capacity fivefold as a coal shortage roils its thermal business and payment defaults by state utilities widen the group’s losses.

Lanco needs funds to meet a plan of adding 500 megawatts annually in three years, with 350 megawatts to be built for customers and the rest coming from its own plants, V. Saibaba, chief executive officer of the New Delhi-based company’s Lanco Solar unit said in a telephone interview. Government policies to promote alternative energy sources will make the investment attractive, he said.

“The political intent in India is very strong,” Saibaba said, speaking from his office in Gurgaon near New Delhi. “Constraints like coal availability and fuel import bills will ensure India will have to focus on renewable energy.”

Lanco is joining Tata Power Co. (TPWR), India’s biggest non-state utility, which said Feb. 5 that it is scouting for investors and planning to sell shares at its solar unit as India extends grants to cut solar project costs and ease curbs on equipment imports. A plan announced last year by the Lanco group to raise $750 million selling stake in its conventional power unit to private-equity funds has stalled amid losses that have surged nine times in the first three quarters of the financial year.

Losses Widen

Shares of the New Delhi-based company have slumped 86 percent from a record reached on Dec. 28, 2007 to 11.2 rupees. The slide in the value has eroded the wealth of Chairman L. Madhusudhan Rao, who was a billionaire as late as January last year, according to data compiled by Bloomberg. The shares fell 1.3 percent at 11:39 a.m. in Mumbai.

“Lanco hasn’t done well when it comes to the power business,” which suffers from fuel supply problems, said Gaurav Oza, Mumbai-based analyst at GEPL Capital Pvt. “They seem to have done much worse in managing utilities as compared to their earlier success in construction.”

Lanco reported an annual loss of 1.1 billion rupees ($21 million) for the group in the year ended March 31, its first since its shares started trading in November 2006. The combined loss in the three quarters ended Dec. 31 climbed to 9.9 billion rupees, according to data compiled by Bloomberg.

State-owned regional electricity distributors, often forced to sell energy below costs, are unable to pay producers as the difference between the cost of supply and average tariff has widened. The utilities had debt of 1.9 trillion rupees as of March 2011, government estimates show, even as lenders tightened credit. That has resulted in poor cash flows for Lanco.

Debt Outstanding

The company has 35 billion rupees of receivables, Rohit Sanghvi, an analyst with Prime Broking Co. in Mumbai, wrote in a Feb. 15 report. The outstanding amount is more than Lanco’s market value. Total debt stood at 95.7 billion rupees, of which the solar unit accounted for 5.5 billion rupees.

Lanco may be counting on interest in solar projects as the government targets to build 9,000 megawatts of grid-connected solar plants by 2017, more than eight times its current capacity. Solar-power producers are assured payments through letters of credit and escrow mechanisms set up by state governments, according to Saibaba.

With costs for alternative energy projects coming down, the tariff for solar and thermally produced electricity may reach parity in about three years, Saibaba said.

Interest Costs

Better potential realization is also helping lenders offer cheaper credit for solar producers, said Satnam Singh, chairman of Power Finance Corp. (POWF), India’s biggest state lender to electricity utilities.

“We cut lending rates for renewables this month because we see better returns in the near future,” Singh said in an interview. Of the 23.7 billion rupees sanctioned by Power Finance to renewable companies in the year ending March 31, 15.8 billion rupees was to Lanco Solar, he said.

Solar companies have to pay interest rates as high as 13.5 percent to 14 percent in India, Saibaba said. The weighted average cost of debt for NTPC Ltd. (NTPC), the nation’s biggest power producer, was 8.6 percent according to data compiled by Bloomberg.

India’s policy draft released in December said the government would for the first time fund the solar industry with direct grants covering as much as 40 percent of the upfront cost of building projects. That model has previously been used to build roads, ports, railways and fossil-fuel power plants in India.

Slow to Fund

Private lenders have been slow to fund solar because of a lack of confidence in the technology, according to the draft. Solar companies in India sell power to state utilities which in turn cannot recover their costs from customers who buy power at lower rates.

Lanco will add 90 megawatts of solar capacity by the end of the fiscal year ending March, including a delayed 75-megawatt photovoltaic project for the local state-owned utility in the western Maharashtra state that it won in May 2011, he said.

Another 100 megawatts of capacity being built using solar- thermal technology in northern Rajasthan state has been delayed by a year, Saibaba said. The project, awarded under the first phase of India’s solar auctions in 2010, had to be reengineered to make allowances for differences in radiation levels and delays in getting heat-transfer fluid from U.S. suppliers, he said.

‘Still Grasping’

Lanco Solar is completing a manufacturing plant that will be able to produce 1,800 tons of polysilicon, 100 megawatts of ingots and wafers and 75 megawatts of modules a year, Saibaba said. The company expects to increase that capacity to 250 megawatts of modules annually in three years, he said. The total cost of this plant is 13.4 billion rupees of which 70 percent has been funded by loans, he said.

Private investors may look at the government’s commitment to support alternative energy sources before pledging any funds, said Mahesh Patil, who manages $2.5 billion in equity as co- chief investment officer at Birla Sun Life Asset Management Co. in Mumbai.

“Investors the world over are still in the process of grasping the business dynamics of solar-power developers,” Patil said. “Secondary markets, at least in India, aren’t yet ready to support share sales by renewable-energy companies.”

While alternative energy like solar panels could revolutionize the way we generate power, they haven’t always been as efficient as they are today. This solar power efficiency infographic shows just how far we’ve come in the earliest days of signs of power conversion. To this day labs are coming up with new solar tech & innovations that are using different materials & chemical solutions to convert more of the sun’s rays into viable electricity that can be put on the grid.

1953 Solar Panel Efficiency

In 1953 when most people weren’t concerned with generating alternative green energy solar panels were showing signs of getting to a point where someone could actually power some household lights. Appliances still weren’t faced with energy compliant saving regulations so most appliances wouldn’t have been able to work off of a 1953 solar panel. The efficiency rating of a solar panel in 1953 was cranking out about 4.5% of the available energy from the sun’s rays into electricity. The amount of electricity generated by a solar panel at that time was about 230 watts.

The catch is that in 1953 the size of the solar panel to generate 230 watts was enormous to today’s standards in size of a typical solar panel width and height. The height of a 4.5% energy conversion solar panel producing 230 watts in 1953 was 213 inches tall and 130 inches wide. That is nearly 3 adults at a height of 6 feet tall in height or exactly 17.75 feet tall. The width of this solar panel was about two shorter adults at 10.83 feet. So you could have 3 adults standing head to toe and two shorter 5′ 5″ adults lying down head to toe. That’s a BIG solar panel!

Cost efficiency for a solar panel that was this big in 1953 in generating electricity came out to about $1,785 a watt. Obviously it makes sense why people weren’t to concerned with installing solar panels at their home in this time frame as it was ridiculously more expensive than getting electricity from the power company off of the power grid.

2012 Solar Panel Efficiency

Let’s jump ahead in time about 59 years to current day technology of solar panels. When this solar efficiency infographic was made in 2012 the conversion rate of taking the sun’s energy and turning it into power was at about 15%. That is more than double the rate we were at in 1953. The sad part is there is still about 85% of the sun’s energy just going to waste.

While the efficiency increased quite a bit from 4.5% to 15% the size of a typical solar panel converting this energy into electricity dropped by more than half. Now the size of  a solar panel producing 230 watts in 2012 is only about 64 inches tall and 39 inches wide. Now if you take an adult and put them next to a solar panel they will most likely be taller than the solar panel standing at 5 feet and 3 inches. If you try to take any adult and lay them down to the width of the solar panel they’re going to be longer than the solar panel that is sitting at only 3 feet and 3 inches now.

With all that size reduction and increase in efficiency of energy to electricity conversion in newer solar panels you save a lot of money too. The typical amount you can expect to shell out in cost for a solar panel by the watt of energy production is $1.30 a watt. That’s more than 1,700 times cheaper than a solar panel in the 1953 time frame. Solar looks to be getting quite a bit cheaper huh?

2015 and Beyond Solar Panel Efficiency

The future of solar panels is looking bright with lab produced technology enhancements getting solar panels to about 23.5% efficiency in energy to electricity conversion. The time period is put at around 2015 – to any time in the future we should be expecting to get a solar panel that can generate energy at a 23.5% efficiency rating. That’s going to save even more money in producing solar electricity for sure.

The size of solar panels is expected to continue getting even smaller too with sizes expected to hit 41 inches tall and 25 inches wide. Toddlers will be able to stand next to solar panels in the future and be quite a bit bigger than them it seems. With a height of 3 feet and 5 inches and a width of around 2 feet and 1 inch you could really fit quite a few of these on a roof nowadays. The future looks bright for solar technology as it progresses in better efficient innovations and reduces the size it takes to put them up. This solar power efficiency improvement infographic really makes it easy to see just how far solar technology has progressed in just 60 years.

The municipal corporation of Anantapur in the south Indian state of Andhra Pradesh is set to become the first municipality in the country to set up a solar power project to power its water pumping operations and street lights. The impressive plan includes installation of 5 MW of a solar PV project in the city. The project will be connected to the state’s power grid and will power the water pumping and street lights of the entire municipality’s area.

Anantapur is blessed with significantly high solar energy resource and has already attracted investment from project developers under India’s famous Jawaharlal Nehru National Solar Mission (JNNSM). The project would require an investment of $11 million (Rs 60 crore) and would include installation of nearly 40,000 solar panels. The municipality currently consumes 5 MW on water pumping operations and powering the street lights. This entails an average electricity bill of $1 million per year. With the new 5 MW solar PV project, the municipality will be able to power all these operations with clean energy and save $1 million every year. The total cost of the project would be recovered in 11 years and the municipality will then earn profits for about 14 years, assuming the life of the power plant is 25 years. Additionally, the project will also offset over 180,000 tonnes of carbon emissions over the 25 years of its life.

The municipal authority hopes to secure financial assistance from the Ministry of New & Renewable Energy. The authority will repay loans from the ministry in seven years through the savings achieved in electricity bill payments.

The state of Andhra Pradesh suffers from tremendous demand-supply mismatch in the power sector. The industries in the states have been facing the brunt of the low supply of electricity and are forced to cut production significantly. A large number of power plants in the state use natural gas as fuel and the supply of natural gas, too, has fallen significantly across India.

Solar energy presents a highly logical solution to the poor power situation in the state. The state government recently offered project developers tender to set up 1,000 MW of solar power capacity. The tender received an overwhelming response with developers offering to install up to 1,340 MW of solar power projects.

Did you know that today’s photovoltaic cells are based on a lucky finding by Alexandre Becquerel way back in 1839? He placed an electrode in a conductive solution, and when it was hit by sunlight a current was generated. The first solar cell, however, wasn’t produced until 1883, Charles Fritts produced a 1%-efficiency (!) selenium-on-gold photovoltaic panel.

The photovoltaic effect was then followed by the discovery of the photoelectric effect, which Albert Einstein would publish a paper about in 1904. A flurry of photoelectric advances followed, until eventually, in 1954, AT&T Bell Laboratories created the first modern silicon solar cell. Bell Labs also produced the solar cells used in early space satellites like the Vanguard 1. Soyuz 1, in 1967, would also use solar cells, and would become the first manned spacecraft to do so.

Between the 1950s and 70s, solar power fell out of grace. Producing solar cells was still prohibitively expensive ($250 per watt), and their efficiency still hadn’t broken past the 10% mark. As the semiconductor industry flourished, however, and as the size of silicon boulesand the integrated circuit market boomed, the cost of solar panels plummeted. By 1973, solar panels had reached 15% efficiency, and could be produced for around $10 per watt.

Today, the solar power industry is very healthy indeed. The price per watt is down to around $3 and at-home installations (and government subsidies!) are becoming increasingly common — and just take a look at the number of photovoltaic power stations that opened in 2010! Indeed, you have to look no further than President Obama himself to see how popular solar power is becoming: in 2010, he ordered the installation of solar panels and a solar hot water heater at the White House. Now it’s just a matter of when solar power will overtake coal in terms of cost and efficiency, which could occur in the next few years.

For more information on the history of solar technology, check out the infographic below, or read more about the history of solar power on Wikipedia.

Infographic by SunRun – Home Solar Leasing Made Easy

There’s a complex relationship at work between photovoltaics (PV), heat and sunlight. Solar power works best when the sun’s shining (of course). But when the sun’s shining, everything gets hotter.

PV semiconductors offer more resistance in extreme heat, making them less efficient when the modules should be most efficient. Thankfully, this additional resistance is small, at most, reducing efficiency by about 10 percent. But newer technologies—likethin-film PVs, which don’t rely on crystalline silicon to produce electricity—are less susceptible to heat-related efficiency losses.

So despite PV panels being best suited for regions like the southwestern United States, which receive upwards of 6.0 kilowatt hours of sun per square meter daily, PV panels actually function better at colder temperatures, particularly crystalline silicon-based cells, which are the most commonly used. Their thin-film counterparts suffer smaller efficiency losses due to high temperatures. In an arid region like the southwest, most of today’s PV cells aren’t operating at their peak efficiency during the hottest days of the year.

The semiconducting materials used in PVs, particularly in crystalline silicon PV cells, lose efficiency as temperatures increase. The Physics Hypertextbook explained that as temperature in a conducting material increases, quasiparticles, called phonons, are excited and move throughout the material, impeding the uniform movement of electrons. This impedance is what reduces efficiency in PVs when it gets too hot.

Newer technologies like thin-film PV use different semiconductor materials like Copper indium gallium selenide (CIGS), which don’t lose as much efficiency in the heat. In fact, a study by Loughborough University, “Mapping the Performance of PV Modules of Different Types” found that CIGS produced between 0.5 percent to 2.5 percent more power over a year period, “with the largest differences found in hotter climates.” Another form of thin-film PV, using Cadmium Telluride as the semiconducting element to produce electricity, performed better than crystalline or CIGS PV cells did in high temperatures. The study said that “The performance of CdTe is consistently higher than the two other technologies, by a margin of 5-12 percent over c-Si, depending on location.”

However, some new nanophotovoltaics actually capture infrared (heat) radiation from the sun and would feasibly, when they make it to market, operate at higher efficiencies in the heat. Until then, we’re stuck with thin-film PV and silicon PV modules that operate at lower efficiency in higher temperatures.

Considering installing a photovoltaic (PV) system on your home but are wondering how long it will take? Not long at all!

Most PV systems are installed within a few days of installers starting work. It’s likely to take longer to get the installers there in the first place and to qualify for any solar rebates, credits, or incentives prior to installation of the system. If you’re planning on setting up a net metering system, it may also take the utility company a bit longer to set up a bidirectional electric meter.

It’s possible to install solar on a home so quickly because modern PV systems are developed for easy interconnection. Many modern PV systems are almost like plug-and--play electronics these days, with wiring integrated into the panel, ready for hook up to an inverter, which converts the direct current power produced by the panels into alternating current used by most appliances in your home.

With a flush-mount rooftop PV array, the solar equipment installers simply need to install the panels directly on your roof, wire them to the inverter, shut the power off to your home (should only take a few minutes) and hook the inverter to your home and the grid (when installing a grid-tied system). Installing a battery back-up for non grid-tied homes takes a little longer as well.

Depending on where you live, some roof-top mounted systems need a greater tilt or their orientation must be slightly out-of line with the roof. For such systems, a mounting rack is needed for the panels. It takes a little longer, likely a few hours to a day or two.

If you’re installing a heliostat (sun-tracking) or PV system in a field, it also won’t take much time to install, just enough for the cement foundation to cure, the mounting system to be set up, the panels wired to the inverter, and the wiring to be tied to the home or building where you use the power.

Talking with an installer or a friend that’s already installed solar can be a huge help in learning what to expect when installing a PV system on your building. They can tell you how long it will take, but more importantly (if you want to save money on the system), they can tell you how much time you need to apply for all the incentives that will make your system’s payoff much shorter.

What is a kilowatt hour?

Different types of energy are measured by different physical units: Barrels or gallons for petroleum, Cubic feet for natural gas, Tons for coal, and Kilowatt-hours for electricity

A kilowatt is a unit of power equal to 1000 watts. Wikpedia defines a watt as a “derived unit of power in the International System of units (SI), named after the 18th century Scottish engineer James Watt.  The unit symbol for a watt is “W” and the unit symbol for a kilowatt is “kW”.

A kilowatt hour is the amount of energy you get from one kilowatt for one hour. Electricity use over time is measured in kilowatt hours . Your electric company measures how much electricity you use in kilowatt hours, abbreviated “kWh”. An example of what one kilowatt-hour can do is: 1200 electric shaves, dry your hair 15 times, 4 TV evenings, use a small refrigerator for 24 hours or 4 evenings of light with 60W incandescent lamps. This according to TreeHugger.com

How many kilowatts does an average U.S.home use?

According to the U.S. Energy Information Administration, in 2008, the average annual electricity consumption for a U.S. residential utility customer was 11,040 kWh, an average of 920 kilowatt hours per month.  Tennessee had the highest annual consumption at 15,624 kWh and Maine the lowest at 6,252 kWh.

A huge bumper crop of solar panels already has caused a sharp decline in their prices and bankrupted many manufacturers worldwide over the past two years. Now a research report released Tuesday says another 180 solar panel makers will likely go out of business or be bought by 2015.

Nearly half of them – or 88 companies – will shut down factories in countries that have become too expensive for producing solar panels, namely the United States, Europe and Canada, said GTM Research. The report looks at over 300 solar panel makers to determine their chances of survival.

The prognosis is not only shocking, but it also answers a perennial question, at least for now, about whether solar manufacturing can thrive in the United States. China, which has used state owned banks and utilities to finance solar factory expansion and create domestic demand for solar panels, will continue to dominate solar manufacturing, though the government is reportedly working on rescuing only 12 large companies and forcing mergers in others. GTM is estimating that 54 solar panel makers in China will not survive over the  next three years.4

“Given where the industry is right now and how committed China is for its solar manufacturing industry, it’s very difficult for the U.S. to compete,” said Shyam Mehta, the senior analyst who authored the GTM report. In fact, by the end of 2013, cell and panel manufacturing could disappear all together in the United States.

China’s rise as the world’s epicenter for solar manufacturing has elicited resentment from rivals who believe Chinese companies haven’t competed fairly. The U.S. Department of Commerce recently sided with petitioners of such a trade complaint and imposed tariffs after finding that Chinese solar companies have indeed received illegal government subsidies and sold solar panels at below cost.

Signs of trouble began to show in early 2011, when changes in solar incentive policies in key European markets prompted solar panel makers’ customers – distributors and project developers – to delay purchasing decisions. Prices for solar panels began to fall faster than what manufacturers had expected. The prices dropped by about 50 percent last year and have continued to decline this year. At the same time, many manufacturers had built up massive factories and were counting on a huge surge in demand in the global market. In fact, they continued to churn out solar panels to keep their factories running and workers employed even though demand wasn’t keep pace.

First Solar, an industry bellwether, saw flat revenues and lower earnings during the first quarter of 2011. Life pretty much went downhill from there for many solar panel makers and their suppliers. Young companies that were entering mass production of their technologies in order to compete effectively with larger rivals went bust, including Solyndra and Abound Solar. GE, which once embarked on an ambitious plan to build a 400-megawatt factory in Colorado, decided to shelve that project earlier this year. First Solar, long the king of low-cost manufacturing, decided to gradually shut down its big factory in Germany and put on hold its plans to build new factories in Vietnam and Arizona. Other solar panel makers in the U.S., Europe and Asia have made similar decisions to shutter factories or file bankruptcy.

SunPower is one of them. The San Jose company announced Tuesday it will suspend production at six of the 12 solar cell production lines and cut solar panel production by 20%  in the Philippines. It plans to lay off about 900 employees, most of them located in the Philippines.

Still, some solar manufacturers have proceeded with their plans to build new factories for a variety of reasons. Some thought the oversupply problem would be over soon; others needed to scale up their production to cut costs. As a result, the world will likely see 35 gigawatts of excess solar panels for sale per year over the three years, GTM said.

The plummeting prices for solar panels are good news for installers and solar power plant developers – and ultimately consumers. Some developers haveswitched to solar panels instead using other types of solar technologies. An increasing number of manufacturers have entered the business of developing solar energy generation projects since they are not  making money selling solar panels.

A complete home solar electric system requires components to produce electricity, convert power into alternating current that can be used by home appliances, store excess electricity and maintain safety.

Solar Panels

Solar panels are the most noticeable component of a residential solar electric system. The solar panels are installed outside the home, typically on the roof and convert sunlight into electricity.

The photovoltaic effect is the process of converting sunlight into electricity. This process gives solar panels their alternate name, PV panels.

Solar panels are given output ratings in watts. This rating is the maximum produced by the panel under ideal conditions. Output per panel is between 10 and 300 watts, with 100 watts be a common configuration.

Solar Array Mounting Racks

Solar panels are joined into arrays and commonly mounted in one of three ways: on roofs; on poles in free standing arrays; or directly on the ground.

Roof mounted systems are the most common and may be required by zoning ordinances. This approach is aesthetic and efficient. The main drawback of roof mounting is maintenance. For high roofs, clearing snow or repairing the systems can be an issue. Panels do not usually require much maintenance, however.

Free standing, pole mounted arrays can be set at height that makes maintenance easy. The advantage of easy maintenance must be weighed against the additional space required for the arrays.

Ground systems are low and simple, but cannot be used in areas with regular accumulations of snow. Space is also a consideration with these array mounts.

Regardless of where you mount the arrays, mounts are either fixed or tracking. Fixed mounts are preset for height and angle and do not move. Since the angle of the sun changes throughout the year, the height and angle of fixed mount arrays are a compromise that trades optimum angle for a less expensive, less complex installation.

Tracking arrays move with the sun. Tracking array move east to west with the sun and adjust their angle to maintain the optimum as the sun moves.

Array DC Disconnect

The Array DC disconnect is used to disconnect the solar arrays from the home for maintenance. It is called a DC disconnect because the solar arrays produce DC (direct current) power.

Inverter

Solar panels and batteries produce DC (direct current) power. Standard home appliances use AC (alternating current). An inverter converts the DC power produced by the solar panels and batteries to the AC power required by appliances.

Battery Pack

Solar power systems produce electricity during the daytime, when the sun is shining. Your home demands electricity at night and on cloudy days – when the sun isn’t shining. To offset this mismatch, batteries can be added to the system.

Power Meter, Utility Meter, Kilowatt Meter

For systems that maintain a tie to the utility grid, the power meter measures the amount of power used from the grid. In systems designed to sell power the utility, the power meter also measures the amount of power the solar system sends to the grid.

Backup Generator

For systems that are not tied to the utility grid, a backup generator is used to provide power during periods of low system output due to poor weather or high household demand. Homeowners concerned with the environmental impact of generators can install a generator that runs on alternative fuel such as biodiesel, rather than gasoline.

Breaker Panel, AC Panel, Circuit Breaker Panel

The breaker panel is where the power source is joined to the electrical circuits in your home.  A circuit is a continuous route of connected wire that joins together outlets and lights in the electric system.

For each circuit there is a circuit breaker. Circuit breakers prevent the appliances on a circuit from drawing too much electricity and causing a fire hazard. When the appliances on a circuit demand too much electricity, the circuit breaker will switch off or trip, interrupting the flow of electricity.

Charge Controller

The charge controller – also known as charge regulator – maintains the proper charging voltage for system batteries.

Batteries can be overcharged, if fed continuous voltage. The charge controller regulates the voltage, preventing overcharging and allowing charging when required. Not all systems have batteries: 

With much fanfare, TANGEDCO conducted the pre-bid meeting for potential bidders for the 1000 MW solar power purchase by the utility.

The Big Question

The real question at the end of the pre-bid meeting at TANGEDCO on 19^th Dec was – how many will really bid for the tender and how much will they bid in total?

To answer that question, one needs to consider the key aspects that might deter some serious prospects from bidding:

1. Land identification – identifying large tracts of land in suitable areas is an important factor, and this selection is constrained by the substation capacity limits. Given that there are hardly a couple of weeks for companies to submit a bid and only a few further weeks for them to prove land ownership, companies keen on bidding for large capacities but which do not own land in the state are going to consider this a bit risky. To that extent, there might be lots of 5 MW and 10 MW bids rather than a handful of 100 MW bids
2. Time available to submit bids – a company from Italy stated that Italy is closed from 21^st of Dec until 7^th of Jan 2013. And this will mean they cant submit the bid. While TANGEDCO maintains that there is enough time for enough companies to bid to satisfy 1000 MW of capacity, the point is that such a short timeframe is likely to make some serious players  (especially from abroad) not to bid as well. In the end, TANGEDCO is the loser, because it does not want 1000 MW of power purchase alone, it wants it at the best possible price. How will it be sure it is getting the best possible price if all the best possible companies are not able to bid?

To me, the above two factors pretty much highlight the key weaknesses I see in the tender process, and both of them, as you will observe, have to do with time.

And that should not be surprising! More the time, less the uncertainty in a domain that has scarcity of intelligence. Given an optimal amount of time under such a scenario, players can make wiser decisions. I, along with many of the attendees yesterday, don’t think enough time has been provided throughout the process. The argument that enough players would still bid is logical but sub-optimal. Do you want good enough players to bid, or do you want enough good players to bid? 

Frankly, I don’t understand the reason for the hurry. What if the entire process gets completed in Feb 2014 instead of Dec 2013? More important, which is more critical? Artificial deadlines set according to the whims of those in power, or an optimal timeframe estimate that is required to complete a project with high quality standards? For strange reason, TANGEDCO seems to have chosen the former over the latter.

I only hope TANGEDCO listens to the voices that were clearly heard by everyone yesterday. And these were opinions from companies such as Tata Solar and Welspun, who know much better than TANGEDCO about solar power plants, each having put up tens of MW of such plants. Their voices should have been given more respect that was given yesterday.

The rest of what happened at yesterday’s pre-bid meeting was just commentary. All the same, some stuff you might want to have from the commentary: (I scribbled down most of these, and my handwriting being what it is, quite likely there are some errors over here…will be glad to correct them if they are pointed out)

• Grid failure – what about deemed generation? – An important question, the answer to which was a bit muddled. If one were persistent enough to try figure out the most likely answer – there will be no deemed generation
• Why 20 years and not a 25 year PPA that has been the norm elsewhere? Answer: They had considered it and decided that a 20 year PPA was good enough; that is, if things work out well for 20 years, it should not matter for them to extend it by aonther 5 years. Hmmm…
• Tangedco has already provided a breakup of SS-wise evacuation facilities. The data is available on the TANGEDCO web site. The utility will also provide details of the voltage of these evacuation facilities voltage levels . They just mentioned that these belong to the 11/33/110 KV categories, Southern TN typically has more 11 KV and Western TN more of 22 KV
• There were many blokes who asked about the PLF and what is the tolerance limit provided if the energy generated was much higher (or lower) than what a 1 MW could generate (essentially, what was the acceptable band for PLF. The people on the stage were persistent and determined to misunderstand the question every time it was asked. Funny, it was fairly clear that these folks were bright and knew what they were talking about (at least most of the time), but they simply refused to see the point on this one.
• What would the two main qualification criteria? Do you have the requisite net worth/ What is the location you wish to put up the power plant?
• Quite a few questions on evacuations. TANGEDCO was very confident every time a question on this topic was asked – they said “trust us, we will help you out on whatever evacuation problem you have” In fact, the CMD of TANGEDCO went to the extent of saying if someone were putting up a huge solar park that required a 400 KV substation, TANGEDCO will consider helping him out.
• Repeated requests for extension of timelines, especially for bid submission. Repeated assertions from TANGEDCO that all was well and timelines were not a problem at all.
• A question from a Solaire Direct representative, in which he cited a Rajasthan case to say that the central govt had to pass a guideline for the PPA to be valid. As this was not passed, he said Rajasthan had trouble. Tangedco did not agree with this viewpoint and said they had taken all the relevant people including TNERC on board
• Are imported modules allowed? Yes. TANGEDCO will not just be technology neutral, it will also be country neutral. Sweet words for a neighbouring country we all know so well.
• To questions on the evaluation criteria, TANGEDCO CMD said, “I am interested in only substantially important tender parameters” and he was quite clear that he was willing to overlook / place less weightage on trivial parameters (such as the need for a service tax number etc). Fair enough.
• There was a good question from a company that was already putting up a 5 MW SPV plant under the REC scheme. The gentleman asked if he could use the substation for this bid as well. I don’t think the folks on stage understood the question well enough, as a result there was no clear answer.
• Question: After signing PPA, we will need much more than a month to identify land. 1 month is too little. Answer: I am sure you guys can do it within a month (one land broker used the problem of land identification as an opportunity and creatively marketed his land banks right there!)
• Question: Has this PPA been approved by TNERC? Ans: Yes, TNERC has been taken on board
• To a question on whether they will consider the bids with trackers separately, the answer was No, they were technology neutral, and all they needed from you was a number for the purchase price.
• Draft of PPA – to be uploaded shortly
• Draft of the LC – The draft of the LC will be provided; This will be as per banking regulations as followed by banks
• There was also an observation from TANGEDCO that the Tirunelveli substations might not be able to evacuate much from solar, as thermal and wind have already fully loaded the system.
• There were some trivial questions on whether the EMD could be in the form of banker’s guarantee instead of in the form of DD/Bankers draft/cheque? The answer, as expected, was a No (By the way, the EMD can be converted into security deposit)
• Questions once again on land acquisition, and the answer once again was the same. Nopes, the govt will not be able to do much (But they mentioned there are companies planning for solar parks, so blokes could contact them perhaps?)
• Question: Acc to the tender, 50% of the 20 year maintenance costs for bay extension need to be paid upfront. To some, this sounded unfair. Why 50% upfront when it is going to be spent over a long period of 20 years? Life’s like that, appeared to be the answer.
• Question: Can we change the land location later (guess within the district)? Answer: Yes, but load flow needs to be done again.
• Question: Can we exit without forfeiting the EMD? Yes. You will forfeit only if you back out after having been awarded the allocation
• Question: Can I connect to a substation that has been constructed for wind? Yes, depending on availability of capacity
• Question: What should be mentioned for the land identification in the bid? Village taluk and district should be mentioned
• Question: Can I pump in a 5 MW into a 11 KV line?
• Answer: This is how things go: 3 MW needs a 11 KV line, 3-5 MW require a 22 KV line, a  10 MW requires a 33 KV line; 10 MW + requires a 10 and above – 110 KV line.
• Someone had a qn on hybrid generator, Tangedco said it was tech neutral. I doubt they meant it, because this gentleman was asking obviously about solar/wind hybrid!
• Why only 1 crore net worth required per MW? “We have taken a pro developer attitude and thus NW requirement of just 1 crore”. Point taken, but just scratching my head whether they also expect a no-upper-limit clause to be a pro developer attitude when it could pit a 1 MW bid price against a 100 MW bid price.
• Cost of bay extension work – how much? Will this be communicated? There were more than one chap who asked this question. TANGEDCO will soon provide this detail.
• How much time will it take to pass the bill submitted to TANGEDCO (to the bank)? TANGEDCO appeared to be prepared for this question – or they had good presence of mind. The answer? Approx 1 week from the time the bill is delivered to TANGEDCO.
• To a question on import duty concessions available, the (obvious) answer was that it was beyond the scope of this tender. Since when was a state government responsible for import duties anyway?
• There were other minor questions on the financial relationship (in terms of extent of stakeholding) that is required between the parent & bidding company – these are details that will be provided soon

Update: The Solaire Direct representative sent clarifications on the exact legal issue he was talking about in the Rajasthan context:

“1.      The Rajasthan Electricity Regulatory Commission (RERC) had tried to bring in regulations for RE based Power Projects for competitive bidding. The Commission backed out on this front as it was in conflict with the provisions of Electricity Act, 2003, Section 63 which is as given below. You may have a look at the RERC website for the order issued by the RERC  on this issue.
Section 63 – Notwithstanding anything contained in Section 62, the Appropriate Commission shall adopt the tariff if such tariff has been determined through transparent process of bidding in accordance with guidelines issued by the Central Government.
2.      Under Section 61 of EA, 2003, The Commission creates the Regulations for Tariff and draws power from these Regulations Under Section 62 and awards Tariffs as per Regulations.
3.      In case of Competitive Bidding derived Tariffs, the Commission only endorses the Tariffs derived through bidding process, provided the process is derived based on competitive bidding guidelines Under Section 63.
4.      In case of Renewables, the Central Government has yet to issue the Guidelines and whenever issued those have to be followed appropriately if the tariffs have to be derived through competitive bidding.
5.      Till date, the Central Government has not issued any guidelines. Hence, the whole process may not stand on legal ground.
6.      The Central Government has approached the Court of Law and the matter is subjudiced.
7.      In Rajasthan, RRECL, the State Nodal Agency, has taken a Trading License and will sign the PPA with the Developers and will sign PSA with the State Discoms as an escape route from the above provisions. To make the process successful, you may have to follow that route.”

With some early and significant successes in 2013 Mosaic, a crowd funding solar project developer is forging ahead with new partnerships to expand its reach. Already the company sold its first three crowd funded projects in 2013, selling out $300,000 in under 24 hours. Now it's made some big new friends, among them Standard & Poor's and DuPont.

The companies partnered with Mosaic as part of the new truSolar working group. The collaborative effort with launched with 16 companies in the industry at are working to standardize risk assessment and develop a rating system to evaluate potential projects for their credit worthiness. "The truSolar Working Group was established on January 14th," said Mosaic spokesperson Lisa Curtis. "The founding members of truSolar, led by Distributed Sun and DuPont Photovoltaic Solutions, are among the leaders in solar project asset management, development, financing, manufacturing, insurance and ratings agencies. Founding member companies include Mosaic, ABB, Assurant, Inc., PanelClaw, SMA America, Standard & Poor’s, Booz Allen Hamilton, Rocky Mountain Institute and U.S. National Labs NREL and Sandia," she added.

The working group can help open the door to more potential project lenders. "Less than 5 percent of the country’s 6,500 banks and lending institutions are actively involved in financing solar projects due to ongoing concerns about, and misunderstanding, industry risks,” Curtis said. “Despite a robust market for solar installations, lenders struggle to efficiently underwrite loans in this field. In response to this problem, members of the truSolar Working Group are convening to develop uniform standards for solar project screening, rating and underwriting. These standards will reduce and reliably price financing risk, lower the cost of capital and broadly increase the availability of commercial lending for solar projects, helping market participants more accurately forecast asset performance throughout the lifespan of a solar project."

The partnership comes at an ideal time for the company, following the rapid closing of its first offerings to the public. “Selling out ourfirst publicly available investments in less than 24 hours has greatly raised our brand awareness and will hopefully lead to more partnerships with world-class leaders in energy and finance,” Curtis said.

The company plans to announce new projects soon, as well. “Our next round of projects will have a few options outside of California. Our focus is on finding high-quality solar projects to offer to our investors, the location is less important,” Curtis said.

At this point Mosaic is capable of providing financing for projects up to $2 million, according to Curtis. It’s fixed interest rates vary from 5.5 percent to 7.5 percent. As investors understand the lowered risk of solar projects those interest could go down somewhat.

CHENNAI, FEB. 5: 

The Tamil Nadu Generation and Distribution Corporation is set to start negotiations with potential solar power generators who have bid to enter into long term power purchase agreements with it.

The utility had called for bids from investors to establish over 1,000 MW of solar power generation capacity across the State.

Over 90 bidders had submitted bids to set up about 500 MW of solar power generation capacity. On January 30 Tangedco opened the price bids. The lowest tariff quoted was Rs 5.97 a unit.

Officials had then said a viable tariff would be assessed, formally approved by the utility and individual negotiations initiated with the bidders to match that price.

According to sources in the know, the negotiation is expected to start from tomorrow and Tangedco hopes to finalise the process over the next one week.

According to industry sources, the low bid had caught bidders by surprise. The preferential tariff under the Jawaharlal Nehru National Solar Mission is now at about Rs 7.49 a unit.

According to officials, Tangedco hopes to put in place adequate solar power generation capacity by January 2014 to cater to the Solar Purchase Obligation of high tension and commercial power consumers who have to meet 6 per cent of their power requirement from solar power generation.

Tangedco has estimated that about 1,000 MW of solar power generation will be needed to meet the purchase obligation as outlined in the Solar Energy Policy announced by the State Government.

Tangedco will enter into 20-year power purchase agreements with successful bidders who meet the tariff to be fixed based on the bids. There will be a 5 per cent annual escalation provided up to the 10{+t}{+h} year on the first year’s tariff.

The tenth year tariff will continue till the end of 20-year agreement, according to conditions spelt out in the bid process.