Delhi Metro earlier agreed to buy 180 megawatts of the 750 megawatts of solar power capacity from this arrangement.
NEW DELHI: Seeing the rapid decline in solar power tariffs and incentives from the government for inter-state transmission of solar power, Indian Railways is reportedly moving forward with a massive solar power park.
A solar power park with total capacity of 1,050 megawatts is to be established across three districts in the state of Madhya Pradesh. The capacity in the solar power park may be auctioned by the Solar Energy Corporation of India (SECI) with the Indian Railways signing power purchase agreements to procure the electricity generated.
Indian Railways floated the proposal to acquire electricity from a large solar power park following the success of the Rewa solar power park auction which yielded the lowest-ever tariff up to that time. The Delhi Metro Rail Corporation (DMRC), an urban rail network located 800 kilometers to the north of the project location, agreed to buy 180 megawatts of the 750 megawatts of solar power capacity.
Setting up a solar power park in the middle of the country will enable it to supply electricity to its various regional segments operating across the country. Indian Railways is a major consumer of electricity and plans to further increase electrification to reduce dependence on diesel. Power procurement forms a very substantial part of its operating cost.
Buying power from a solar power project will not only help Indian Railways to fulfill its Renewable Purchase Obligation, but also to significantly reduce the power purchase cost. Solar power tariff bids have collapsed from Rs 2.97/kWh (¢4.60/kWh) for the Rewa solar power park to Rs 2.44/kWh (¢3.80/kWh) for the Bhadla solar power park; the auction bids for this over-1 gigawatt solar power park are expected to fall further as the buyer carries more trust among developers compared to power utilities.
The Indian Railways plans to set up 5 gigawatts of solar power capacity over the next few years, which includes a combination of utility-scale and rooftop solar power projects.