February 1st, 2012, The Centre for Science and Environment (CSE, New Delhi, India) announced an investigation of India's Jawaharlal Nehru National Solar Mission (JNNSM). The organization alleges that one company acquired nine projects in one bidding process through the program, in violation of a one project per applicant rule.

CSE states that LANCO Infratech Ltd. (Gurgaon, India) created "front" companies to acquire 235 MW out of 620 MW of projects, or 40% of total bids, during the auctions for the first batch, first phase of the JNNSM. LANCO has responded that it "strongly objects" to the allegations but has not denied their accuracy, and the Indian government has promised to launch its own investigation.

“We need clean energy. Solar is the option for the future," states CSE Director General Sunita Narain. "But clean energy cannot be built on dirty corporate practices."

"This is why we are exposing this dubious deal. We hope it will lead to better governance and regulation of this energy source of the future."

CSE alleges the creation of seven front companies

The company has begun construction of the nine projects all in Askandara village in the state of Rajasthan. According to CSE estimates, LANCO is set to receive INR 13,000 crore (USD 2.65 billion) in revenue from these projects over a 25-year period.

CSE states that LANCO's name appears only on one winning bid, that of Diwakar Solar Projects, which acquired a 100 MW concentrating solar power (CSP) project. Another LANCO subsidiary is listed among winning bidders for a 5 MW solar photovoltaic (PV) project.

However, CSE states that seven more companies have direct links to LANCO, some of which have company employees and their family members as directors, and others with commercial ties to LANCO.

LANCO admits "equity participation" and "support"

The companies have also been transferred to LANCO control, which CSE states is a clear violation of MNRE guidelines stating that the controlling shareholder of the company which won the bid should not change for one year after commissioning the projects.

In response to these allegations, LANCO has stated that it "supported" the bidders, that it has "equity participation within the permissible level", and that it has done nothing illegal.

MNRE, NTPC fail to cooperate with investigation

CSE states that LANCO was able to circumvent the one company per project rule as neither the Ministry of New and Renewable Energy (MNRE) nor NTPC Vidyut Vyapar Nigam (NVVN, New Delhi, India) have mechanisms to monitor the activities of companies which receive contracts.

CSE also alleges that neither MNRE or NVVN have cooperated with its investigation, and blames non-transparent processes at the MNRE for delays in implementation resulting in LANCO winning bids by unfair means.

The MNRE has stated that will conduct an investigation of the bids, and noted that the bidding process is handled by NVVN.

2012-02-03| Courtesy: Centre for Science and Environment | solarserver.com © Heindl Server GmbH

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