Reasons Behind the 11,400 MW Renewable Tender Cancellations

Approximately 11,400 MW of renewable energy procurement tenders issued by central agencies in India have been cancelled by June 2025, due to issues like insufficient participation and high tariffs. The government has introduced measures to address these challenges and streamline the renewable energy bidding process.

Since April 2023, agencies such as SECI, NTPC, NHPC, and SJVN have cancelled tenders for 11,400 MW of renewable power. Reasons include low bidder participation, unreasonably high tariffs, and withdrawal by targeted end-procurers. Additionally, 43,922 MW of renewable power capacity has received Letters of Award (LoAs), but Power Sale Agreements (PSAs) remain unsigned, largely due to a surge in renewable power bids. Since April 2023, PSAs for 22,683 MW have been signed, indicating progress in some areas.

To address delays in PSA signing and misalignment in bidding and transmission readiness, the government amended the Standard Bidding Guidelines for solar, wind, hybrid, and Firm & Dispatchable Renewable Energy (FDRE) on 12 February 2025. These amendments allow for the cancellation of LoAs after 12 months if PSAs are not signed. The government is also encouraging states to comply with Renewable Consumption Obligations (RCO), urging agencies to aggregate demand from distribution companies and design products accordingly, and organising regional workshops with major renewable energy-procuring states.

As of June 2025, India’s total installed electricity capacity is 484.82 GW, with non-fossil fuel sources contributing 242.78 GW, or 50.08%. This includes 116.25 GW from solar, 51.67 GW from wind, 11.60 GW from bioenergy, 54.48 GW from hydropower, and 8.78 GW from nuclear power. These figures reflect India’s commitment to expanding renewable energy, despite challenges in tender execution.

The cancellations highlight the complexities of scaling up renewable energy infrastructure. Insufficient participation suggests a need for better incentives for bidders, while high tariffs indicate market challenges in achieving cost-competitive renewable projects. The government’s proactive measures aim to align bidding processes with transmission infrastructure and demand, ensuring smoother project implementation in the future.

In conclusion, the cancellation of 11,400 MW of renewable energy tenders underscores the challenges in India’s renewable energy sector. However, government interventions, including amended guidelines and increased coordination, aim to address these issues. As India continues to expand its non-fossil fuel capacity, these efforts could strengthen the renewable energy ecosystem, supporting the country’s sustainability goals.

Source: Outlook Business