Coal India signs first ever power purchase pact with GUVNL for sale of 100 mw solar power

On Friday, CIL, a state-owned company, announced that it had signed its first ever power purchase agreement with Gujarat Urja Vikas Nigam Ltd. (GUVNL) for the sale of 100 megawatts of solar power.

The power purchase agreement (PPA) has a 25-year term, according to Coal India Ltd. (CIL).

The company said, “We are excited that we could win our first ever solar auction bidding. CIL said in a statement that it would strongly engage in more such auctions in the future.”

CIL earned a 100 MW solar power project in a reverse auction held by GUVNL in March.

CIL was awarded the contract for the 100 MW bid with the agreement that it enter into a PPA for the development of a solar power project and supply the power produced to GUVNL within 18 months of signing the PPA.

The 100 MW project will be carried out by CIL through a solar EPC (engineering, procurement, and construction) contractor. It has already released a tender for the finalisation of a solar EPC contractor, which is nearing completion.

 

The project will be completed within one year of the work order being placed.

CIL is willing to undertake solar power generation as a renewable energy solution, and it ranks high in its diversification portfolio.

By 2024, the company plans to generate 3,000 megawatts of solar energy. Solar power projects are expected to receive Rs. 13,500 crore (US$ 1.80 billion) in funding from the company's internal capital, special purpose vehicles (SPVs), and bank loans.

CIL is establishing the requisite in-house resources and has assembled a team of capable officers to support its solar initiatives, according to the company.

It added, “Solar will eventually replace coal as a major source of energy, and we're laying the groundwork to ensure our position in the country's energy market. We want to make a significant investment in solar power generation.”

CIL added two more fully-owned subsidiaries to its base on April 16 to speed up its foray into the production of cleaner renewable energy sources. These will serve as special purpose vehicles (SPVs) for carrying out the company's specified goals.

'CIL Navikarniya Urja Ltd.' and 'CIL Solar PV Ltd.' are the two SPVs that were established. Both of the registered organisations will be located in the state of West Bengal.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.