Jain Irrigation Shirsoli Solar Plant

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Jain Irrigation Systems Limited (JISL),signed an MoU with Maharashtra State Electricity Distribution Co. Ltd. (MSEDCL) for setting up a 8.5MW photovoltaic solar project at village – Shirsoli in Jalgaon district of Maharashtra. In July 2010, the project migrated from Generation Based Incentive (GBI) Scheme with MSEDCL to Jawaharlal Nehru Solar Mission (JNNSM). JISL has decided to use multi-crystalline technology for its 8.5 MW project out of which 7.5MW will be mounted on fixed structure while 1 MW will use single axis tracking to enhance the isolation period by a minimum of 25% (this increases the power generation output during the beginning of the day and end of the solar day. The tracking system installed at this project is expected to improve the capacity utilization factor from 18.25% to 22.5%).The project activity will use 230Wp of mono/multi crystalline PV Cells.The output from the project would be fed to the western grid of India. The land requirement for the project would be about 45acres. The project would be connected to the nearest 33 KV line of MSEDCL. It could not be ascertained if JISL had entered into any Power Purchase Agreement with MSEDCL or NTPC Vidyut Vyapar Nigam (NVVN), which was the the nodal agency to purchase solar power generated by independent solar power producers, under the Jawaharlal Nehru Solar Mission (JNNSM). Please note that this project had been transferred from Maharashtra State Electricity Distribution Co. Ltd. (MSEDCL) to JNNSM. This was, however,the first project accredited (on May 2012) under the Renewable Energy Certificate (REC) scheme of the Government of India. RECs were generation-based ‘certificates’ awarded (electronically) to those generating electricity from renewable sources such as wind, biomass, hydro and solar, if they opted not to sell the electricity at a preferentially higher (feed-in) tariff (to avoid double subsidy). Electricity producers already selling power at a preferential feed-in tariff were not allowed to later switch to the REC mechanism. Although each solar REC was worth a minimum of INR 9.3 ($0.23)/kWh (guaranteed floor price), the solar REC market was yet to pick up in India. The main challenge it faced, was the lack of a long-term predictability of REC pricing. The current REC floor and forbearance prices were fixed for five years, i.e. they were only applicable through 2017. Post 2017, the status of the prices were yet undecided. The total capacity of 8.5MW was eligible for carbon credits also and JISL had already applied for CDM benefits (confirmed from UNFCC database). As per MERC (State Regulator) Regulation,JISL would retain the gross benefits of CDM. Transmission and/or wheeling charges would be paid by JISL. Financial closure took place in September 2011.The total project cost was US$ 28.2mn (INR 1327 mn @47 INR/USD).The debt equity ratio for the project was 68/32. Financing comprised of a 11 year term loan of US$ 19.2mn (INR 903mn @ 47INR/USD) and sponsor equity of US$ 9mn (INR 424mn @ 47INR/USD). IDFC was the sole arranger of the term loan. Construction for the project started in September 2011 and commercial operation was expected to start in March 2012.