Bids Invited to Develop 250 MW of Solar Projects with ₹2.83_kWh Tariff Cap in Maharashtra

The Maharashtra State Power Generation Company Limited (MAHAGENCO) has invited bids from solar power developers for setting up 250 MW of grid-connected solar photovoltaic projects at the Dondaicha Solar Park in Dhule, Maharashtra.

The deadline for bid submission is February 15, 2021. The tender specifies a ceiling tariff of ₹2.83 (~$0.038)/kWh, valid for 25 years.

The project is expected to cost ₹875 billion (~$11.9 billion) and must be commissioned within 15 months from the date of the power purchase agreement (PPA). It must also achieve financial closure within nine months from the date of the PPA. The project will be divided into three blocks – Block I (75 MW), Block-II (125 MW), and Block III (50 MW).

Bidders must submit a performance bank guarantee of ₹1.05 million (~$14,396)/MW of quoted capacity within 30 days from the date the letter of award is issued.

The selected developer must set up the solar power project and the transmission network to the solar park pooling substation. The company must acquire all approvals, permits, and clearances required for setting up the project from the state government and local bodies.

Bidders are expected to place a single bid for the entire 250 MW of projects. The declared annual capacity utilization factor (CUF) for the projects must not be lower than 19%. Developers are expected to maintain generation within a range of 10% over or 15% lower than the declared annual CUF. MAHAGENCO said it would purchase any excess generation at 75% of the tariff agreed upon in the PPA.

To be eligible to participate in the competitive bidding process, applicants must have a minimum annual financial turnover of ₹10.5 million (~$143,955)/MW of the quoted capacity in one of the last two financial years. They are also expected to have a positive net worth as of the end of the last financial year.

According to Mercom’s India Solar Tender Tracker, Maharashtra has floated tenders for about 13.37 GW of utility-scale solar projects as of December 2020. As per Mercom’s India Solar Project Tracker, the state has about 1.6 GW of operational solar projects and about 1.2 GW under development as of September 2020.

In a recent petition, the state electricity regulator heard the distribution company say that it had floated 27 tenders with a total capacity of 14,459 MW since December 2017. The contracted capacity was 3,234 MW. The distribution company requested that the regulator allow it to raise the tariff caps to attract bidders. In response, the regulator replied, “If the DISCOM has a poor record of payments, then the bidder would look for a higher cost to secure itself from the impact of delayed payment. Hence, to attract more bidders, MSEDCL first has to demonstrate good-paying culture towards its contracted generators or provide robust and transparent payment security mechanisms in the bid document.”

Recently, the Maharashtra State Cabinet issued its ‘Unconventional Energy Generation Policy’ with plans to implement 17,360 MW of transmission system-connected renewable power projects by 2025, including 12,930 MW of solar power projects.