Ministry of new and renewable energy has instructed state utilities to issue solar and wind energy tenders in effort to become more independent. This means. they will not have to rely on central utilities to meet renewable energy demands.

A source close to the matter told ET “Finally, it is the state which is procuring power, so it’s better that they issue tenders on their own. States are better aware of what tariffs they can afford to purchase renewable energy.”

MNRE secretary Anand Kumar, said: “It has been observed that states have not come forward with the initiatives and bidding plans for renewable energy capacity addition, and have instead relied upon bids by central PSUs like Solar Energy Corporation of India (SECI).”

“This will also help the state in adding generation capacity at financially competitive rates as compared to the marginal cost of power from fossil fuel-based thermal power capacity addition,” he added.