October 2, 2025
  • Recently, the Ministry of New and Renewable Energy (MNRE) said it would be doing away with the practice of reverse auctions — when companies bid to offer the lowest price — while awarding contracts for setting up wind ¬energy projects.
  • India has committed to installing 60,000 MW of wind power projects by 2022, but has met only two thirds of the target.
  • According to Indu Shekhar Chakravarty, Secretary, MNRE, there were complaints from the industry that e¬-reverse auctions are leading to tariffs being artificially lowered leading to unhealthy competition.
  • While reverse auctionswere the norm for all renewable energy projects, including solar and wind projects since 2015, the government’s change of stance signals that the rock¬bottom prices associated with clean energy projects — per unit solar power costs have fallen to ₹2.40 a unit — do not reflect the true costs of renewable energy.

Reason for dip in health

  • The cost of large tracts of land required to install wind turbines is among the reasons cited for the dwindling health of the sector.
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