Extended deadline for India’s CSP projects until March 2014

Published on: Thursday, 09 May 2013
Extended deadline for India’s CSP projects until March 2014

India’s Concentrated Solar Power deployment under first phase of National Solar Mission (JNNSM) has failed –as expected- to be commissioned on time. The Ministry of New and Renewable Energy has extended deadline for commissioning for ten months from May 9.

Seven CSP projects totaling 470 MW were allocated under phase I of JNNSM back in 2010. The projects, promoted by Corporate Ispat Alloys, Lanco Infratech, Hira Group, Aurum Renewable Energy, KVK Energy, Megha Engineering and Reliance Power, had to be commissioned by May 2013 or would face some penalties if delayed.

Only one project, the one developed by Hira Group’s subsidiary Godawari Green Energy, a 50 MW parabolic trough plant near Nokh Village in Jaisalmer district of Rajasthan, is expected to meet the deadline and could be commissioned today. As previously reported at CSP World, Godawari has been receiving key components form different supplier as the steam generation unit from Denmark's Aalborg CSPHCE tubes from Germany's Schott or the turbine form Siemens. The rest of the projects are suffering delays of up to 15 months.

Projects have suffered delays in equipment supply, probably due to high requirement of local components that could not meet the delivery times, but the main problem remains to be economic.

Project developers are struggling to raise funds for the plants, a lack of confidence from lenders, inaccurate data of Direct Normal Irradiance (DNI), which has been proven to be around 15% lower than forecasted as it was taken from satellite data and not from on-site measurement, a lack of demonstration projects, some very low tariffs offered by bidders and subsequently delays in scheduled completion milestones have made this first phase not to be an easy ride.

It’s been reported that a delay in the construction of a water pipeline by Rajasthan state has affected to Reliance’s 100 MW project. A shortage of the Heat Transfer Fluid (HTF) used in parabolic trough plants, whether Dowtherm A or Therminol VP1 has occurred due to a lack of more providers and the concurrence of several orders for plants in Spain and the US. This could have reportedly increased the price of HTF by roughly 50%.

Godawari, the only plant to be on-line as scheduled, has reportedly been forced to get foreign equipment due to a lack of local parts, what has led the company to pay up to a 25% more for some components.

With this extended deadline, MNRE is looking to show its confidence in the CSP sector after developers asked Ministry to postpone deadline by six to fifteen months, otherwise, some plants could face heavy fines and could even not to meet PPA requirements leading to terminate their contracts.

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