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The government of India is moving to rebid around 40 GW of stalled solar and wind projects due to missing power purchase agreements. Officials clarified that no investments have been made yet, only price discovery, with solar tariffs between INR 2.38-2.56/unit and wind between INR 3.70-3.90/unit. FICCI stated that CERC is close to finalizing guidelines for virtual PPAs, which could unlock financing for these stranded projects. Virtual PPAs allow corporate buyers to support renewable projects financially without direct electricity delivery, receiving renewable energy certificates for ESG compliance, addressing delays in traditional PPA payments.
The government of India is set to initiate rebidding for about 40 GW of renewable energy projects that have been delayed due to the absence of power purchase agreements (PPAs), according to officials. These projects include both solar and wind capacities. Advertisement
Sources indicated that marketing efforts are underway, and if these do not yield results, the authorities may eventually decide to close the projects. Currently, the winners of these tenders are in discussions with distribution companies, the prospective buyers, and no investments have been made in the projects so far. Only price discovery has occurred, with solar tariffs ranging from INR 2.38 to INR 2.56 per unit and wind tariffs between INR 3.70 and INR 3.90 per unit.
Meanwhile, the industry body FICCI highlighted that the Central Electricity Regulatory Commission (CERC) is expected to release final guidelines for virtual power purchase agreements (VPPAs) shortly. The guidelines could unlock financing for over 40 GW of stranded renewable energy projects nationwide. S K Chatterjee, CERC's Chief of Regulatory Affairs, mentioned that the commission is in the final stages of finalizing the framework after receiving extensive feedback from stakeholders on draft guidelines shared earlier this year.
FICCI noted that this development addresses a longstanding challenge in the renewable sector regarding delayed payments from distribution companies under traditional PPAs. Virtual PPAs allow corporate buyers to financially support renewable projects without taking physical delivery of electricity, instead receiving renewable energy certificates as proof of green power procurement.
The commission designed the VPPA framework to meet two key objectives: enabling stakeholders to claim green attributes for ESG compliance without traditional PPAs and facilitating more than 40 GW of renewable projects. The guidelines also ensure that VPPAs are treated as non-transferable specific delivery contracts rather than financial derivatives, following consultations with the Securities and Exchange Board of India. Physical electricity delivery will occur but through wholesale markets rather than direct supply to corporate buyers.
Source PTI
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