NTPC Tenders 2 GW of ISTS-Connected Wind to Avail Benefits of ISTS Waiver

March 14, 2018


The National Thermal Power Corporation (NTPC) has forayed into competitive wind auctions in a big way and issued a mega tender for the development of 2 GW of interstate transmission system (ISTS)-connected wind power projects across India. The bid-submission deadline is April 25, 2018.

The minimum bid capacity is 50 MW and the maximum bid capacity is 500 MW. This is a global tender, but limited liability partnership (LLP) companies are not eligible for participation.

The project must be designed for interconnection with the ISTS in accordance with prevailing Central Electricity Regulatory Commission (CERC) regulations. ISTS connectivity and long-term access will be the responsibility of the successful bidders.

NTPC Vidyut Vyapar Nigam Limited (NVVN), a wholly-owned subsidiary of NTPC, will enter into 25 year power purchase agreements (PPAs) with the successful bidders.

The wind power projects must be commissioned within 18 months from the effective date of the PPA. In case of failure to achieve this milestone, NTPC will levy charges. For delay up to six months, NTPC will encash the performance bank guarantees on per day basis and proportionate to the capacity not commissioned, with 100 percent encashment for six-month delay.

In case the commissioning of the project is delayed beyond six months, the tariff discovered for the project will be reduced at the rate of 0.50 paise/kWh per day of delay for the delay in such remaining capacity which is not commissioned.

The maximum time period allowed for commissioning of the project with encashment of performance bank guarantee and reduction in the fixed tariff will be 27 months from the effective date of the PPA.

In February 2018, the Ministry of Power issued an order stating that no interstate transmission charges and losses will be levied on solar and wind power projects commissioned up to March 31, 2022.

When contacted, an NTPC official told Mercom, “We are a leader in the power generation sector and to maintain pole position one must diversify. NTPC is present in a big way in solar and wind is an integral part of renewables as a whole. So, this was on the cards.”

The NTPC official also said that there is no upper tariff ceiling for this tender.

“Plus, the wind tariffs have fallen within the past year and now ISTS charges have been waived, this means there will be demand for cheap wind power. It is the right time to foray in wind reverse bidding,” added the NTPC official.

The RfS has been prepared per the Ministry of Power issued competitive bidding guidelines for wind projects in India, added the NTPC official.

Mercom previously reported, wind tariffs have firmed around the ₹2.85 (~$0.043)/kWh mark after the recently concluded Maharashtra State Electricity Distribution Company Limited (MSEDCL) 500 MW wind auction. The lowest ever quoted wind tariff in India is ₹2.43 (~$0.037)/kWh.

Saumy Prateek Saumy is a senior staff reporter with MercomIndia.com covering business and energy news since 2016. Prior to Mercom, Saumy was a copy editor at Thomson Reuters. Saumy earned his Bachelors Degree in Journalism & Mass Communication from the Manipal Institute of Communication at Manipal University. More articles from Saumy Prateek.