Maharashtra Floats Tender for 1 GW Pumped Hydro Storage Capacity

The last date to submit the bids is April 15, 2024


The Maharashtra State Electricity Distribution Company (MSEDCL) has issued a request for selection to procure 1,000 MW of energy storage capacity for 40 years from inter or intra-state connected pumped hydro storage projects on a demand basis.

The energy storage projects must have eight hours of discharge capability with a maximum of five hours of continuous discharge.

MSEDCL will make use of the energy storage facility to meet its storage renewable purchase obligations, manage surplus electricity available on the grid, meet electricity demand, manage the intermittency of renewable power, and satisfy the ancillary requirements within the state.

The last day to submit the bids is April 15, 2024. Bids will be opened on the same day.

Bidders must submit a non-refundable document and bid processing fee of ₹10,000 (~$120.33) each. They must also submit an earnest money deposit of ₹500,000 (~$6,016)/ MW of the quoted capacity.

The selected bidders must submit a performance bank guarantee of ₹1.2 million (~$14,439)/MW of the allotted capacity per project within 30 days of receiving the letter of award or signing the energy storage facility agreement (ESFA).

MSEDCL will enter into an ESFA on an annual fixed charges basis with the selected bidders for 40 years.

The developer must commission the project’s total capacity within 48 months of the effective ESFA date.

The project size must be a minimum of 100 MW. If MSEDCL received a cumulative bid capacity of more than 1,000 MW from technically qualified bidders, it may decide to increase the award capacity to 2,000 MW under the greenshoe option.

MSEDCL will arrange the power required to charge the pumped hydro energy storage project at the delivery point up to the declared cycle loss. It will utilize the energy storage facility on an ‘on demand’ basis during the peak and off-peak hours to meet its power requirement.

The developer must bear the deviation charges for charging and discharging.

Projects that are already commissioned or under construction or not yet commissioned but have surplus capacity available will be considered, provided that the total capacity of these projects is not already accepted under any other central or state programs. Augmentation of already commissioned projects, irrespective of their capacities, will not be considered under this tender.

The projects that are already commissioned must maintain a minimum lifespan of 40 years.

The companies submitting the bids for the tender must be registered under the Companies Act 2013. Limited liability partnership companies are not eligible to participate in the tender.

MSEDCL has proposed to promote only commercially established and operational technologies to minimize the technology risk and achieve timely commissioning of the contracted capacity.

Bidders must have commissioned or operated thermal or hydro generation projects for capacity equivalent to that they quoted for the tender.

They should have commissioned renewable energy projects for a cumulative capacity of 2.5 times the quoted capacity.

Alternatively, they can also present experience in completing engineering, procurement, and construction work in infrastructure projects for power, hydroelectric, water bodies, dams, metro, roads, reservoirs, tunnels, etc., with the total project cost equivalent or more than the amount corresponding to the ₹20 million (~$240,652)/MW of the quoted capacity.

Bidders must have a net worth equal to or greater than ₹15 million (~$180,489)/MW of the cumulative quoted capacity as of the last date of the previous financial year.

Their minimum annual turnover must be ₹10 million (~$120,326) /MW of the quoted capacity during the last financial year or as on the day at least seven days before the bid submission deadline.

They must also demonstrate an internal resource generation capability in the form of profit before depreciation, interest, and taxes for a minimum of ₹2.5 million (~$30,082)/MW of the quoted capacity as of the last date of the previous financial year.

They must present an in-principle sanction letter from their lending institutions or banks, committing a line of credit for a minimum of ₹1.25 million (~$15,042)/MW of the quoted capacity towards meeting the working capital requirement of the quoted project capacity.

Bidders must identify and arrange the project’s connectivity to the nearest central /state transmission utility point.

They must bear all connectivity charges, General Network Access charges, long-term access charges, scheduling/regional load despatch charges, and losses up to the delivery point.

The conversion loss of the energy storage projects, calculated as the percentage of the energy input to the system that is lost during energy storage and retrieval, must not be more than 25%. The conversion loss must remain constant during the entire term of the contract. The energy storage project developer must demonstrate a minimum roundtrip efficiency of 75% for each charging-discharging cycle.

The minimum availability of the project must be 95%, and in case of a planned shutdown, MSEDCL must be notified at least one month in advance.

Bidders must quote the total storage cost, including component A – Annual Fixed Charges expressed as INR/MW/annum and component B – cycle loss expressed as a percentage.

The total storage cost will be calculated as – Component A + (Component A x Component B).

Recently, MSEDCL invited bids for the procurement of power on a long-term basis through a competitive bidding process from 5,000 MW grid-connected solar photovoltaic power projects.

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