Going Green: NTPC to buy 1 GW of solar plants to reduce its carbon footprints

NTPC currently has 928 MW of operational renewable energy generation units, out of which 870 MW are solar plants.

Keen to reduce its carbon footprint and have a diversified portfolio of power assets, state-run NTPC, by name and predominantly a thermal player, is augmenting its renewable energy (RE) capacity in a big way. And the chosen route is acquiring RE assets, then the greenfield plants.

The PSU has issued tenders to acquire 1,000 MW of operational solar plants, running for at least a year, and supplies power to their buyers at not more than Rs 5 per unit. The move is seen by industry experts as the power major’s initial step, while it traverses a route over the next 10 years to have massive RE assets of 45,000 MW.  Even as its thermal capacities are also being increased, it will have RE capacity of 30% of total generation portfolio of 1,30,000 MW by then, from nominal level now.

Under the latest round of reverse auction for solar projects by state-run Solar Energy Corporation, a tariff of `2.36 a unit was discovered, an all-time low. Average tariff of thermal power by NTPC under power purchase agreements (PPAs) is Rs 3.90 per unit.

Of course, domestic solar modules and panel manufacturers are facing the heat of Chinese imports and the government is trying to safeguard their interests by assorted import duties. But the long-term business prospects of solar developers in the country are still bright.

According to industry experts, acquiring operational projects would help NTPC bypass the major challenges of land acquisition and shortage of evacuation infrastructure that are currently being faced by many renewable energy developers. Out of the NTPC’s RE capacity by 2030, about 30,000 MW will be solar, and the balance will consists of wind, small hydro etc.

Currently, the total installed capacity of the power behemoth stands at 62,910 MW. In line with the diversification strategy, NTPC is also planning to enhance its presence in consultancy, power trading and foray into newer sectors such as electric mobility and battery storage.

NTPC currently has 928 MW of operational renewable energy generation units, out of which 870 MW are solar plants. Another 2,298 MW of the company’s solar projects are under various stages of implementation. Apart from its own projects, NTPC acts as an aggregator of renewable energy through which is it supplies power to a number of states from solar and wind plants owned by other developers. The ministry of new and renewable energy has identified NTPC as the nodal agency for setting up 20,000 MW solar and wind power capacity, and nearly 4,000 MW of such projects has been commissioned under this mode so far.

NTPC, in February, had also signed an ‘implementation support agreement’ with Rajasthan to develop a 925 MW Nokh solar park in Jaisalmer. The company is expected to invest more than Rs 3,500 crore in building the project and the state will invest about Rs 450 crore in developing the ancillary infrastructure.