Nepal’s state-owned power utility, NEA, has issued a request for proposals to select independent power producers to build 100 MW of grid-connected PV capacity at 16 sites throughout the country.
The projects must be at least 1 MW in size. At certain sites, capacities could range from 10 MW to 30 MW. The tender is open to companies from any country. Interested developers have until Feb. 26, 2023, to submit their bids.
Selected projects will be granted 25-year PPAs. In March, the NEA set a maximum PPA price of NPR 5.96 ($0.043)/kWh. Since 2017, the utility has concluded PPAs with developers at a rate of NPR 7.30/kWh. However, project developers oppose the price gap and have refused to participate in the tender if prices aren't raised, according to local media reports.
“Our executive committee meeting reached a conclusion after the calculation that less than NPR 7.30 per unit is not feasible to recover the cost in 10 years,” said Prakash Bikram Basnet, the president of the Solar Electric Manufacturers Association of Nepal. “We have also decided that our member companies won’t participate in the bid invited by the NEA until our demand is addressed.”
Only developers that offer prices equal to or lower than NPR 5.96/kWh will be eligible to sell electricity to NEA after developing their projects, according to the tender notice. Local media reports indicate that NEA is not in favor of revising the rate. Suresh Bahadur Bhattarai, an NEA spokesperson, said the authority set the PPA rate based on global market trends.
“Those who want to participate in the bid are welcome,” he said. “We have not forced them to join the bid.”
According to the International Renewable Energy Agency (IRENA), Nepal had installed 93 MW of cumulative solar capacity by the end of 2021.
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