Economy

Govt proposes 15-year PPA for FDRE projects with battery storage

The Power Ministry has proposed a 15-year power purchase agreement (PPA) for tariff-based competitive bidding of 15 years in (TBCB) projects aimed at supplying firm and dispatchable power from grid-connected renewable energy (FDRE) projects with Energy Storage Systems (ESS).

This is part of the amendments to the guidelines for TBCB process for the procurement of firm and dispatchable power from grid-connected RE power projects with ESS. The Ministry has also sought comments on the same from stakeholders.

“The PPA period shall generally be for 15 years from the scheduled commencement-of-supply date (SCSD) or from the rescheduled date of commencement of supply to the extent of the extension granted by the procurer on the grounds which are beyond the control of the generator,” the draft guidelines said.

The PPA may, however, also be fixed for a longer period such as 25 years. The duration of the PPA must be specified upfront in the request for selection (RfS) document, it added.

The developers will be free to operate their plants after the expiry of the PPA period. The developer may upgrade and repower their plants during the PPA period at their own risk and cost, and participate in subsequent bids to the extent of their untied capacity, it has proposed.

Installing AWS

The developer shall install and maintain GPS-enabled automatic weather stations (AWS) as per the technical specifications and standards specified by relevant central government agencies.

The availability of data from AWS shall be ensured as specified by the appropriate load dispatch centre and other Central government agencies, in accordance with the provisions of the Indian electricity grid code and instructions from the appropriate load dispatch centre as needed.

The technical criteria shall include provisions to ensure that the developer complies with applicable cybersecurity regulations, directives, and guidelines issued by the Central government authorities dealing with cybersecurity.

The Power Ministry has also proposed to introduce a new instrument for the establishment of an earnest money deposit (EMD) and Performance bank guarantee.

“Insurance Surety Bonds which would be paid unconditionally similar to a bank guarantee or any other instrument approved in general financial rules as amended from time-to-time by the Central Government,” it has proposed.

In addition to the other remedies, this PBG (or alternatives provided as per these Guidelines) can be encashed to recover any damages or dues of the generator in terms of the PPA.

“It is hereby clarified that the damages or dues recovered by the Intermediary Procurer by encashing the PBG, upon the default of the generator under the PPA, shall be credited to the Payment Security Fund to be maintained by the Intermediary Procurer,” it added.

PBG (or alternatives provided as per these guidelines) shall be returned to the generator within 45 days of the actual commencement of the supply date of the project. In case of part commencement of supply of power, PBG corresponding to such part capacity should be released within 45 days of the actual commencement of supply date, the Ministry has proposed.



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