The Energy Efficiency Services Limited (EESL) has invited bids for off-grid solar water pump systems across India under the Pradhan Mantri Urja Suraksha evam Utthaan Mahabhiyaan (PM KUSUM) program that is targeted towards promoting solar in agriculture.
The scope of work includes the design, manufacture, supply, transport, installation, testing, and commissioning of 10 horsepower (HP) water pumps along with the warranty, repair, and maintenance for five years. The last date for the submission of bids is January 10, 2020. In all, 181,200 solar pumps will be installed across the country, categorized under clusters in each state.
Interested bidders are expected to submit an earnest money deposit (EMD) for clusters of locations they choose to set up their projects in. The deposits for location clusters range between ₹3.36 million (~$47,093) and ₹30.6 million (~$428,883). Bidders can participate in more than one cluster.
Applicants for this tender can only be either solar PV module manufactures or solar pump manufacturers. This was an amendment to the KUSUM program introduced in August 2019. The Ministry of New and Renewable Energy (MNRE) said that to ensure the quality and post-installation services, only manufacturers of solar water pumps or solar modules would be allowed to participate in the bidding process.
However, system integrators of solar water pump systems have raised concerns about the KUSUM program allowing only manufacturers to participate in tenders. System integrators play a crucial role in the solar pump industry, and their view is that this move by MNRE could have negative ramifications for the industry at large. According to system integrators, solar water pump manufacturers do not have experience in large-scale deployment of projects as their focus is manufacturing and servicing the products they supply.
Consortiums are not allowed to participate. Bidders must also have been profitable in the last financial year and for at least one year in the preceding two fiscals.
The tender also specified a minimum annual turnover threshold for the last three financial years. The threshold ranges between ₹50.5 million (~$707,796) and ₹459 million (~$6.43 million) depending on the location of the cluster. The net worth of the bidder as on the last day of the preceding financial year is also expected to be not less than 100% of the paid-up share capital.
Bidders have to use domestically manufactured solar modules with indigenous solar cells. This mandate has received a mix response from the industry with industry organizations suggesting modifications in the program. Solar Micro, Small, and Medium Enterprises (MSMEs) have been especially dissatisfied with the directive of using indigenous solar cells because of the shortage of domestic production of solar cells.
The government has begun the process of allocating the capacities to various states under the KUSUM program. The capacities have been allocated to several states in line with the demand received from states, the targets listed under the KUSUM program, and the guidelines. These will be applicable for the first year of the program.
Before this tender, Mercom reported that EESL issued a tender for 175,000 off-grid solar water pumping systems under the program. Apart from the design, manufacture, supply, transport, installation, testing, and commissioning, the scope of work also included warranties, repair, and maintenance of the pumps for five years.
Earlier, EESL issued a tender to procure 272,579 solar water pumping systems for member countries of the International Solar Alliance. The scope of work includes the design, supply, installation, testing, and commissioning of solar water pumping systems. The successful bidder will also provide maintenance services.
Image credit: Claro Energy
Nithin Thomas is a staff reporter at Mercom India. Previously with Reuters News, he has covered oil, metals and agricultural commodity markets across global markets. He has also covered refinery and pipeline explosions, oil and gas leaks, Atlantic region hurricane developments, and other natural disasters. Nithin holds a Masters Degree in Applied Economics from Christ University, Bangalore and a Bachelor’s Degree in Commerce from Loyola College, Chennai. More articles from Nithin.