DRAFT POLICY GUIDELINES: NSM Phase-II batch-II Tranche-I State Specific Bundling Scheme for 3000MW Solar PV projects

Executive Summary


  1. Ministry of New and Renewable Energy has released draft guidelines for selection of 3000 MW capacity solar projects under the National Solar Mission Phase 2, Batch 2, Tranche 1. Link to the notification dated 12 January 2015 is here: http://mnre.gov.in/file-manager/UserFiles/Final-draft-3000-MW-Tranche-1-Draft-Guidelines-State-Specific-Bundling-Scheme-2015_12012015.pdf
  2. MNRE has described this allocation to be under a “State-specific bundling scheme”. Interested states will support creation of Solar Parks and implementation of the whole scheme.
  3. Total of 25 Solar Parks will be developed under this scheme. Solar Park Implementation Agency (SPIA) will provide the land and connectivity. SPIA will provide all details for the project before submission of bids. The bidder will approach the SPIA for allotment of land and connectivity.
  4. Working capital fund of approximately INR 2,300 Crore will be setup.
  5. NTPC Vidyut Vyapar Nigam Limited (NVVN) will be responsible for implementation of this policy initiative, in association with Central and State Agencies. MNRE will indicate the total quantity for various states based on response received from the states. NVVN may then procure that quantity through one or more state-specific tenders.
  6. Bidding will be state-specific and conducted through e-bidding. Developer will submit bids quoting a fixed levelized tariff for 25 years. Selection will be based on lowest quoted tariff, which cannot be higher than Central Electricity Regulatory Commission (CERC) approved solar tariff.
  7. NVVN will purchase the generated electricity from these solar projects under Power Purchase Agreements (PPA) for 25 years, and bundle it with unallocated thermal power in 1:2 ratio. NVVN will sell this bundled power to state utilities under 25-year Power Sale Agreements (PSAs) at weighted average tariff, plus trading margin of INR 0.07 per kWh.
  8. Minimum project size will be 10MW. The maximum capacity for single bidder may vary from state to state, but it will not exceed 300MW for the projects other than ultra-megawatt solar power projects.
  9. Bidders can avail fiscal incentives like accelerated depreciation, concessional customs and excise duties, tax holidays etc.
  10. Domestic Content Requirement (DCR) for state-specific bidding has not been specified in the draft; it will be determined before each state-specific bidding. Under (DCR), all the solar cells and modules used in these solar projects must be made in India. The raw material for the wafers and other can be imported.
  11. Project developers can choose to develop the whole or a part of solar project outside solar parks in a specific state.
  12. Excess power generated will be purchased at national support price of INR 3 per kWh.
  13. Part commissioning of 50% of total capacity will be acceptable and further in the steps of 10MW unit size. This is not applicable for projects having capacity of 10MW. It will be entitled for payment of energy at INR 3 per kWh until fully commissioned.
  14. Processing fees of INR 2 lakh for each project up to 20MW capacity and INR 3 lakh for each project above 20MW will be payable by the project developer.
  15. Inter-connection point / metering point shall be at 33kV or above from the solar power project to the pooling station at the solar park.
  16. The entire cost of transmission from the project up to the interconnection point including cost of construction of line, wheeling charges, losses etc. will be borne by the Project Developer.
  17. If SPIA or other state bodies cause any delays in land allotment or provision of transmission, developers may be given extra time to commission.
  18. The net worth of the bidder should be equal to or greater than the value calculated at the rate of INR 1.5 crore or equivalent USD per MW of the project capacity.
  19. Earnest Monet Deposit (EMD) of INR 10 lakh per MW in form of Bank Guarantee along with RfS will be payable. Performance Bank Guarantee of INR 20 lakh per MW at time of PPA will be payable.
  20. After execution of PPA, the controlling shareholding in the Company developing the project shall be maintained for a period of one year after commencement of supply of power.


Time Schedule


Sl. No. Event Date
1. Notice for Rfs Zero Date
2. Application Submission Zero + 45 Days
3. Bid Opening and short-listing based on Rfs Zero + 90 Days
4. E-Bidding and short listing Zero + 45 Days
5. Issue of LoI Zero + 60 Days
6. PPA Signing Within 30 days after LOI
7. Financing Arrangement Within 210 days after PPA
8. Commissioning 13 months from date of signing of PPA


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