- TANGEDCO has issued RFS documents for 1,500 MW solar power capacity through reverse bidding
- Developers can bid for a minimum capacity of 1 MW and maximum of up to 500 MW
- The Tamil Nadu utility has issued 4.00 INR ($0.062) per kWh as the upper tariff limit for the tender
- If the developer does not get grid availability for more than 175 hours in a fiscal year, TANGEDCO will purchase excess power generated next year for the PPA tariff
- TANGEDCO will be accepting bids until June 16, 2017
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The Tamil Nadu Generation and Distribution Corporation Limited (TANGEDCO) has invited bids for 1,500 MW of solar power capacity through reverse bidding process. It has issued a request for submission (RFS) documents for the tender.
Developers will have to bid for a minimum of 1 MW capacity and a maximum of up to 500 MW.
TANGEDCO had reportedly requested Tamil Nadu Electricity Regulatory Commission (TNERC) to set 4.00 INR ($0.062) per kWh as the upper limit for this tender. TANGEDCO has stated in the RFS documents, “In order to facilitate developers to establish solar power plants of capacity 1 MW and above and also to have a competitive rate, TANGEDCO proposes to facilitate the investors by procuring the energy generated from these plants through a long term Energy Purchase Agreement up to a capacity of 500 MWac, for a total capacity of 1,500 MW considering the tariff of Rs.4.00 as upper limit.”
Last date for bid submission is June 15, 2017. More details about the tender are available on TANGEDCO website.
The renewable purchase obligation (RPO) for fiscal year 2016-17 for TANGEDCO is 2.5% and 5% for FY2017-18. Procuring solar power through this 1,500 MW capacity is now a necessity for TANGEDCO to be able to achieve its RPO targets.
Tamil Nadu is aiming to generate 5,000 MW of grid connected solar power by 2020 under its Vision 2023 Solar Power Generation Programme.
TANGEDCO will be the off-taker. If there is no grid availability for up to 175 hours in a financial year, then there will be no generation compensation for the developer. But it is goes beyond 175 hours, excess generation by the project in the next financial year will be bought by TANGEDCO at the PPA tariff to compensate for the loss.
Pointing at the condition that project capacities up to 50 MW will have to be completed within 12 months and those above 50 MW within 24 months, Mercom Capital Group has observed that a 24 months time frame is one of the longest in India and could attract very low bids.
With TANGEDCO, developers have had issues of payment delays and curtailment issues in the past, raising the risk for developers, stated Mercom.