ANNOUNCEMENTS
India is at the forefront of the global transition to renewable energy, with solar energy playing a key role in meeting its energy requirements and climate goals of 500 GW from non-fossil sources by 2030. Competitive bidding through renewable energy auctions, particularly reverse auctions, is one of the primary strategies India uses to procure and reach its renewable energy targets. Despite auctions effectively lowering prices, significant challenges like delays and low deployment rates persist.
The focus of this study is to examine the auction design elements and their impact on the effectiveness, particularly the deployment effectiveness of solar energy auctions. Since the dependent variable is constrained, a Tobit regression is used, using expert views and secondary data from 20 solar auctions between 2016 and 2022.
Key findings indicate that deployment success is significantly and directly influenced by geographical specifications, maximum capacity, and earnest money deposit (EMD) requirements. On the other hand, longer planned commissioning times, larger minimum capacity, and longer grace periods have a detrimental effect on project execution, possibly decreasing urgency or restricting participation.
This study closes a significant gap by illustrating how particular aspects of auction design impact deployment results in India. The results offer valuable insights for enhancing project execution, minimizing delays, and refining auction designs.
