According to Economic Times, Bridge to India, a consultancy, said in a report that
The report also mentioned that harmonised tariffs have stayed reasonably stable around the average level.
Prices at individual auctions have varied, depending on the agency that conducted it, whether the project is in a solar park and radiation availability. It found that “projects tendered by NTPC and located inside solar parks were highly oversubscribed and subsequently had lowest tariffs.”
The lowest bid during the 18 months covered in the study was Rs 4 per unit in an auction conducted by the Solar Energy Corporation of India at Bhadla Solar Park in Rajasthan in November 2016. Since then, an auction at the Rewa Solar Park in Madhya Pradesh saw the tariff drop to Rs 3.3 per unit in February.
The report said even if solar tariffs have not fallen as much as commonly believed, they are low enough to reduce solar developers’ average internal rate of return to 14.2 per cent against a benchmark of 18 per cent in the sector.