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The Ministry of Power has unveiled fresh directives for the competitive bidding procedure concerning wind power projects linked to the national grid. The initiative is geared towards boosting renewable energy capacity and fulfilling the renewable purchase obligation (RPO) of distribution licensees.
The objective of these guidelines is to establish a transparent and equitable procurement framework by means of open competitive bidding. This is intended to ensure competitive pricing and risk-sharing among stakeholders, fostering project reliability and investor returns.
Furthermore, the guidelines intend to create a structure for the long-term trade of wind power between states, which is anticipated to enhance stability and reduce risks within the renewable energy sector.
The application of these guidelines pertains to projects with a bidding capacity of 10 MW and higher linked to intra-state transmission, as well as projects with a bidding capacity of 50 MW and above linked to inter-state transmission.
The preparatory stage for bidding involves several conditions, including the formulation of bid documents according to stipulated guidelines. The procurer must obtain government approval in cases where deviations are necessary. The bid timeline may encompass additional project-related milestones, such as land acquisition and connectivity, while specifying penalties for non-compliance.
The bidding structure revolves around power capacity (MW) terms, with minimum and maximum bid capacity specifications. Bidders quote tariffs, with the procurer designating a benchmark tariff. Bids are allocated through bucket filling, commencing with the lowest tariff (L1) bidder, with subsequent bidders falling within a predetermined range allocated capacity.
The proposed power purchase agreements (PPAs) must align with stipulated tariff parameters and include provisions for deviations, force majeure, and compensation. To ensure project viability, wind power generators are mandated to acquire necessary clearances, permits, licenses, land, and grid connectivity ahead of power supply commencement.
The Ministry is poised to conduct the bidding process utilizing electronic platforms, allowing for technical and financial bid evaluations. The successful bidders’ shareholding pattern and performance will be monitored, and penalties will be imposed for supply delays. In a bid to further support wind energy, the government has established specific targets and an advanced bidding schedule for capacity procurement over the next few years.
These new guidelines are expected to significantly bolster India’s renewable energy landscape, promote investor confidence, and contribute to meeting the nation’s sustainable energy goals.