Solairedirect, a unit of French utility Engie (EPA:ENGI), has not yet signed a power purchase agreement (PPA) for the 250-MW solar project in Andhra Pradesh, India it won in April, the Economic Times reports.
The auction was conducted by Indian power major NTPC Ltd (BOM:532555) and the French company was the successful bidder with what was then a record-low offer of INR 3.15 (USD 0.048/EUR 0.041) per kWh.
Citing sources, the Economic Times said that Engie has not yet received a letter of award (LoA) confirming it has been awarded the project. The usual two-month period for signing a PPA after an auction has been extended for the third time till the middle of November, according to the report.
The reason is that NTPC has been unable to find a buyer for the output of the solar power plant. After solar tariffs fell further in subsequent actions, Andhra Pradesh's nodal agency for renewable energy told NTPC it no longer wanted to buy the power, the Economic Times said. NTPC has reportedly held discussions with other states but a decision has not been reached yet.
An industry insider was quoted as saying that NTPC usually finds buyers easily and it is uncommon for it to extend PPA signing periods, but the falling tariffs have disturbed the market.
(INR 100 = USD 1.539/EUR 1.308)
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