Facing severe criticism of its role as an agency in setting up RE projects through developer mode, the Solar Energy Corporation of India (SECI) has said that in some cases, bidders can voluntarily reduce discovered tariffs if they do not find any takers.

The public statement by one of the four government-designated renewable energy implementing agencies (REIAs) came late Monday, roughly a week after the news broke of US prosecutors alleging the involvement of Gautam Adani in bribing Indian government officials for lucrative renewable energy (RE) supply contracts.

“In some cases, bidders also suo-moto reduce the discovered tariff if subsequent to bidding process, tariff have come down and no Discom is willing to buy at discovered tariff,” SECI said in a public statement.

This statement is largely to counter allegations that Adani Green Energy and Azure Power suo motu reduced the discovered tariffs in the controversy-hit manufacturing-linked solar power supply tender, which was coated by SECI in 2019.

In 2022, Adani Green Energy and Azure Power suo-motu reduced the discovered tariffs in the ill-fated tender from Rs 2.92 per kWh to ₹2.54 per kWh and ₹2.42 per kWh. The Central Electricity Regulatory Commission (CERC) also cleared the same.

However, SECI did not comment on the US prosecutor’s charges that Sagar R Adani and Vneet S Jaain had “secretly influenced” the SECI process for reallocation of the 2.3 gigawatt (GW) PPAs to Adani Green Energy’s subsidiary, including by directing the US Issuer’s admissions to SECI and by obtaining and revising internal SECI documents.

Unique business model

Defending its business model, the government-controlled agency said the Ministry of New and Renewable Energy (MNRE) and Ministry of Power (MoP) issue standard bidding guidelines for Solar, Wind, Hybrid, Round-the-Clock (RTC), etc. tenders.

SECI (as well as other REIAs) floats tenders according to the Bidding Trajectory allocated by MNRE using a transparent electronic bidding method in which all private/public parties are allowed to participate.

After the e-bidding and e-reverse Auction process, the lowest tariffs are discovered, and capacity is offered to DISCOMs across India for power procurement.

The same is also posted on SECI’s official website to enable various Discoms to avail of the capacity at the discovered tariff. The Discoms then approach SECI with their REpower requirements. One bid normally consists of multiple developers and buyers.

Discoms, based on their internal approval process, provide their consent for the offtake of power to SECI, after which SECI enters into a Power Sale Agreement (PSA) with the concerned Discoms.

After signing the PSA, SECI enters into a Power Purchase Agreement (PPA) with the selected bidders. During project implementation, SECI monitors project progress and aids in resolving issues.

Post-project commissioning, SECI, as an intermediary power trader, procures the electricity generated by the projects and sells it to the Discoms as per the terms of the PPA/PSA, respectively.

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