Gujarat Urja Vikas Nigam Limited (GUVNL) has tendered 500 MW of wind projects to be developed across the state. The bid-submission deadline is April 2, 2018.
Under this global tender, interested entities from other countries must form Special Purpose Vehicles (SPVs) under the Indian Companies Act.
In this tender, GUVNL has also given the project developers an option to produce an extra 500 MW of wind power at the Lowest Quoted Tariff (L1) under the Greenshoe option. The scope of work includes development of wind projects along with the required transmission infrastructure up to the delivery point.
The minimum project capacity a single bidder can bid for is 25 MW. No upper ceiling has been provided for the project capacity or the bidding tariff. The Power Purchase Agreements (PPAs) will be signed within one month from the date of issue of Letter of Award (LoA). The PPAs will be executed between GUVNL and the selected bidders for a period of 25 years from the date of commercial operation of the project.
The successful developers are required to secure the financing arrangements within seven months from the date of PPA signing. GUVNL has also specified that it will encash the performance bank guarantees on a regular basis, proportionate to the capacity not commissioned in case of a delay of six months in the commissioning of the project.
However, if the commissioning of the project is delayed beyond six months, the tariff discovered after e-reverse auction will be reduced at the rate of ₹0.50 (~$0.0078)/kWh for each day of the delay for the entire term of the PPA.
The maximum time-period allowed for the commissioning of the entire project capacity with the encashment of Performance Bank Guarantee (PBG) and the reduction in the fixed tariff has been limited to 27 months from the date of execution of PPA or till the tariff becomes zero, whichever is earlier.
The general manager (IPP) at GUVNL told Mercom, “This Greenshoe option being exercised is good as it does away with repeated tenders. GUVNL will allow any bidder who has been successful in the 500 MW auction to develop an extra capacity if they are willing to do it at the L1 tariff.”
“This Greenshoe option is a bit different from the Greenshoe option provided to developers in the 500 MW solar PV tendered by us. In this tender, for exercising Greenshoe option, the first preference will be given to government entities. Once they have exercised their option, only then general bidders will be awarded capacities from the remaining amount,” the official added.
The auction will be conducted according to the guidelines provided by the Ministry of Power for reverse auction of wind tenders. In the past, a 500 MW wind auction by GUVNL was delayed as the Indian Wind Energy Association (IWEA) had petitioned against it, citing lack of proper guidelines.
Wind power tariffs dropped to a record-low level of ₹2.43 (~$0.038)/kWh quoted in the previous GUVNL wind auction. Commenting on GUVNL’s hopes from this auction, the official said, “We are hoping tariffs to be favorable for us again. If you consider the recent wind auction by Solar Energy Corporation of India (SECI), tariffs quoted for wind are below the ₹2.50 (~$0.038)/kWh mark.”
Mercom recently reported that GUVNL also tendered 500 MW of grid-connected solar projects to fulfill its Renewable Purchase Obligation (RPO) and to meet the future requirements of the distribution companies (DISCOMs) in the state of Gujarat. In this tender too, GUVNL had given the project developers the Greenshoe option to produce an extra 500 MW of solar power at the lowest quoted tariff.
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Saumy is a senior staff reporter with MercomIndia.com covering business and energy news since 2016. Prior to Mercom, Saumy was a copy editor at Thomson Reuters. Saumy earned his Bachelors Degree in Journalism & Mass Communication from the Manipal Institute of Communication at Manipal University. More articles from Saumy Prateek.