IREDA’s 5 GW Solar Projects Under the CPSU Program Comes With a ₹2.20/kWh Tariff Cap
Bids for the grid-connected solar power projects were invited on January 29, 2021
The Indian Renewable Energy Development Agency (IREDA) has capped the tariff for the 5 GW of grid-connected solar power projects (Tranche III) under the central public sector undertaking (CPSU) program Phase-II at ₹2.20 (~$0.030)/kWh.
The agency had released the notice inviting bids for the projects on January 29, 2021.
The ceiling tariff will be exclusive of any third-party charges like wheeling and transmission charges and losses, point of connection charges and losses, and cross-subsidy surcharges as applicable. The bidding process for the projects under this tender will only be under the domestic content requirement (DCR) category.
More details of the tender have been released now.
The last date to submit the bids is March 04, 2021. Bids will be opened on March 08th. The pre-bid meeting will take place on February 18th.
IREDA has been entrusted with the task of carrying out the bidding process. The Solar Energy Corporation of India (SECI) was the implementing agency for this program earlier.
Bidders will have to pay an amount of ₹400,000 (~$5,470)/MW as the earnest money deposit. They will have to submit an amount of 50% of the total Viability Gap Funding (VGF) approved after the e-reverse auction.
The maximum permissible limit for the VGF is ₹7 million (~$95,725)/MW. Any government producer setting up solar projects will be eligible for VGF assistance if it sets up the project for self-use or use either by government or government entities, directly or through the DISCOMs.
For the projects to be implemented under this tender, both the solar cells and modules used in the solar power projects must be made in India, preferably from the manufacturers listed in the Approved List of Models and Manufacturers.
The project should be designed for interconnection with the interstate transmission system (ISTS) or the state transmission utility (STU) per the prevailing regulations. The responsibility of getting ISTS or STU connectivity and long-term open access will rest with the developer with the cost to be borne by the developer.
The maximum time allowed for commissioning the full project capacity will be limited to 30 months if the allocated capacity is up to 500 MW and 36 months if the capacity is over 500 MW.
Only government bidders will be allowed to participate in this tender. In the case of a consortium, one of the government-owned companies should be the lead member. The successful bidder can also execute the project through a special purpose vehicle, with at least 76% shareholding.
The bidder should not be a loss-making entity and should have a positive net worth in the previous financial year.
According to Mercom’s India Solar Tender Tracker, a total of 3.5 GW of solar tenders have been issued under the CPSU program.
IREDA has approved renewable energy loans worth ₹126.96 billion (~$ 1.69 billion) and disbursed ₹87.58 billion (~$ 1.17 billion) during the financial year 2019-20. Loan approved during the year, including co-financed projects, take over loans, would support capacity addition of 5.67 GW compared to 3.26 GW last year. The government has set a revenue target of ₹24.06 billion (~$323.39 million) in 2020-21 for IREDA.
For renewable energy expansion, has signed a memorandum of understanding to undertake the techno-financial due diligence of renewable energy, energy efficiency, and conservation projects for SJVN and with NHPC for providing its technical expertise in developing renewable energy projects.