Bihar Removes Ceiling Tariff for 250 MW Solar Project, Extends Bid Submission Deadline

The Bihar Renewable Energy Development Agency (BREDA) has reissued a request for proposal (RfP) for 250 MW of power from solar projects through a tariff-based competitive bidding process. The state has now removed the tariff ceiling and extended the bid submission deadline.

BREDA removed the earlier tariff ceiling of ₹3.15 (~$0.042)/kWh and extended the deadline for submission of bids to June 16, 2020, from April 27, 2020, previously.

In March, the Ministry for New and Renewable Energy (MNRE) said that upper ceiling tariffs or tariff caps will no longer be prescribed in future bids.

In December 2019, Mercom reported that BREDA reissued its first large-scale solar tender with a revised ceiling tariff of ₹3.15 (~$0.042)/kWh. The tender was initially issued in June 2019.

Interested bidders were expected to make an earnest money deposit (EMD) of ₹400,000 (~$5,334) in the form of a bank guarantee (BG). BREDA had said that to be eligible to take part in the competitive bidding process, the applicants must have a net worth of at least ₹7 million (~$93,350) per MW.

According to the tender documents, the solar power generator was expected to attain the financial closure in terms of the power purchase agreement (PPA) within 12 months from the date of execution of the PPA.

Last year, the state had dismissed a petition regarding this tender without granting further time for the tariff negotiation.

In September 2019, the Commission had rejected another petition that requested the adoption of a tariff of ₹3.45 (~$0.049)/kWh and the regulatory approval for the procurement of 250 MW of solar power. The Commission found the tariff of ₹3.45 ($0.05)/kWh to be on the higher side. It recommended that the tariff be renegotiated with the developers between the range of ₹3.05 ($0.043)/kWh to ₹3.15 ($0.044)/kWh considering that the projects are developed in Bihar. The Commission also suggested that in case the bidders and BREDA cannot arrive at a renegotiated tariff in the suggested range, the instant bid process should be canceled, and BREDA retender the projects.

The state of Bihar is way behind when it comes to solar development. According to Mercom India’s Solar Project Tracker, the state currently has only 111 MW of large-scale solar projects in operation, as of March 2020.

Earlier, the Bihar Renewable Energy Development Agency BREDA invited bids for the design, supply, installation, testing, and commissioning of 7 MW grid-connected rooftop solar PV projects.