NHPC tender shakeout — How Reliance Infrastructure undercut rivals at Rs 3.13/kWh

Why the winning tariff for a 700 MWp solar + 780 MWhr storage project could reshape competitive bidding in India’s renewable auctions

Reliance Infrastructure Limited (NSE: RELINFRA, BSE: 500390) has thrown down the gauntlet in India’s renewable energy sector with a bold bid in the latest NHPC tender. The firm secured a Letter of Award for a 700 MWp solar and 780 MWhr battery storage project at a discovered tariff of just ₹3.13 per kilowatt-hour.

For investors and sector observers, the bid is less about a single project and more about the competitive marker it sets. At a time when India is aggressively pushing dispatchable renewables, Reliance Infra’s willingness to commit at razor-thin margins highlights the intensity of the solar-plus-BESS race — and its determination to lead it.

What made the NHPC tender different from previous auctions?

The tender was structured around dispatchable renewable energy, requiring developers to pair solar generation with battery storage to deliver power on demand. Fifteen bidders entered, and fourteen qualified for the e-reverse auction. The response was oversubscribed by nearly four times, underscoring how storage-backed renewables have become the most coveted opportunity in India’s energy transition.

Unlike pure solar auctions, where tariffs have steadily fallen below ₹2.5/kWh, the addition of large-scale batteries changes the economics entirely. Developers must balance capital costs of advanced storage technologies with tariff competitiveness. In that context, Reliance Infra’s ₹3.13/kWh stands out — it is low enough to win but high enough to stay just above unviable thresholds.

How does ₹3.13/kWh compare to peers and global benchmarks?

In India, previous hybrid tenders (solar-wind-storage) have cleared in the ₹3.5–4/kWh range. Even SECI’s recent round-the-clock renewable auctions saw tariffs closer to ₹3.5/kWh. Globally, storage-backed solar contracts in markets like California or the Middle East are often priced higher, though falling battery costs have begun to close the gap.

Reliance Infra’s tariff, therefore, sits at the frontier of competitiveness — lower than most recent Indian storage-linked bids, and significantly below international averages. Analysts say this positions the firm not only as a domestic leader but also as a price-setter in global conversations about affordable clean energy with storage.

Where does this leave rivals like Adani Green, Tata Power Renewable, ReNew, and NTPC?

The tender outcome is likely to reverberate through India’s renewable industry. Adani Green, which has aggressively scaled solar and wind capacity, has yet to commit heavily into large-scale storage. Tata Power Renewable has been building a BESS portfolio but remains more conservative on tariffs. ReNew Energy Global, one of the earliest movers in storage-linked hybrids, has been pricing closer to ₹3.5–3.7/kWh in past bids.

NTPC Green Energy, the renewables arm of NTPC Limited, carries the balance sheet strength of a public sector giant but faces internal mandates on financial returns. Against this backdrop, Reliance Infra’s tariff signals that private players may be more willing to compress margins to gain scale leadership.

Sector watchers note that such aggressive bidding could push rivals to either sharpen their cost structures or risk losing tender share.

What are the risks of bidding so low in a capital-intensive segment?

While the headline figure generates excitement, the economics behind ₹3.13/kWh are unforgiving. Solar panels and battery packs are subject to commodity-linked price fluctuations, particularly lithium-ion cells, where global supply chains remain volatile. Any delay in commissioning or cost overrun could erode returns rapidly.

Transmission connectivity also poses a risk. ISTS projects require synchronization with central grid upgrades, and delays can lead to penalties. Reliance Infra will need disciplined project execution and procurement leverage to ensure the bid remains financially viable.

In short, the tariff win locks in leadership optics, but execution will determine whether it becomes a value creator or a financial drag.

How are institutional investors interpreting the outcome?

Investor sentiment is divided but attentive. On the one hand, the bid demonstrates Reliance Infra’s ability to compete at the sharp end of the renewables market. This enhances credibility and signals to regulators and financiers that the group is serious about storage-backed clean energy.

On the other hand, some institutions worry about “winner’s curse” dynamics, where developers undercut to win tenders but later struggle to deliver acceptable returns. With the stock already responding positively to a string of recent announcements — including regulatory clarity on BSES asset recovery and a new JV in Bhutan — the NHPC win adds momentum but also raises scrutiny.

Analysts suggest that investors will watch closely how Reliance Infra structures financing for the project, whether it brings in strategic partners, and how quickly it secures supply agreements for batteries.

Could ₹3.13/kWh become the new benchmark for storage-backed renewables in India?

The answer depends on whether Reliance Infra can deliver on time and within cost. If the project is successfully commissioned, it could reset tariff expectations for future NHPC and SECI auctions, forcing peers to match or risk losing relevance.

However, if execution struggles emerge, regulators and financiers may view ₹3.13 as unsustainably low, reinforcing tariffs closer to the ₹3.5–4 range. Either way, the bid has injected fresh urgency into the storage race, underlining that the days of renewables without storage are over.

For Reliance Infrastructure, the NHPC win is not just another EPC mandate but a signal of intent in India’s evolving renewable market. By locking in the tariff at ₹3.13/kWh, the company has placed itself at the sharpest edge of competition, sending a clear message to peers and policymakers that it is willing to balance short-term margin pressure in exchange for long-term positioning. This is the hallmark of players looking to dominate scale-sensitive markets such as renewables and storage, where early leadership can translate into financing advantages, supply chain leverage, and policy visibility.

The move also redefines Reliance Infra’s identity. Traditionally recognized for metro rail projects, road concessions, and power distribution, the group is now making a deliberate shift into dispatchable renewables — the very category regulators and utilities see as the backbone of India’s energy transition. By competing head-on with incumbents like Adani Green, Tata Power Renewable, and ReNew, the company is not only chasing volumes but also shaping the price benchmarks that will guide future auctions.

For investors, this creates a dual narrative. On one hand, the aggressive tariff could compress project-level returns, raising execution risk. On the other, successful commissioning would cement Reliance Infra as a credible leader in solar-plus-BESS, a space expected to attract billions in institutional flows over the next decade. In effect, the NHPC award is as much a financial test as it is a strategic declaration: Reliance Infra is betting that scale and early mover advantage in storage-linked solar will matter more than short-term profitability.

If the company delivers on schedule and maintains cost discipline, the project could become the reference point for India’s next wave of tenders, reshaping how investors, regulators, and competitors evaluate storage-backed renewables. In that sense, the NHPC win is more than a contract — it is Reliance Infrastructure’s attempt to anchor itself at the heart of India’s clean energy narrative.