Gujarat Retenders 100 MW from its 700 MW Tender for Raghanesda Solar Park

Gujarat Urja Vikas Nigam Limited (GUVNL) has retendered the remaining capacity (100 MW) from its earlier tender for purchasing power from grid-connected solar projects in the state’s Raghanesda Solar Park.

GUVNL said it was retendering 100 MW of capacity that was unallocated in its previous solar tender for 700 MW of solar projects to be set up at Raghanesda Solar Park (Phase X) in Gujarat. The present tender comes with a ceiling tariff of ₹2.75 (~$0.0366)/kWh.

Interested bidders are expected to submit an earnest money deposit of ₹400,000 (~$5,324)/MW of the quoted capacity in the form of a bank guarantee. The last date for the submission of bids is August 17, 2020.

The projects are to be installed on a build-own-operate basis. The successful bidder is expected to set up the solar projects along with the power evacuation cable up to the pooling station. However, the solar power park developer is required to obtain all approvals, permits, and clearances required for setting up of the project (including connectivity) from the state government and local bodies.

GUVNL noted that land plots in the solar park will have a fixed capacity of 100 MW and that no partial installations will be allowed. It added that each bidder must place a bid for exactly 100 MW, and the tariff quoted must be single and uniform for the entire capacity.

The state power generation, transmission, and distribution agency also added that the declared annual capacity utilization factor (CUF) must not be less than 17%.

To be eligible to participate in the competitive bidding process, the net worth of the bidder in the last two financial years must be at least ₹8 million (~$106,478)/MW of quoted capacity.

There is a long history behind the tenders, retenders, and auction of projects at the Raghanesda Solar Park.

The history of tenders and retenders by GUVNL

The GUVNL initially issued the tender for the 700 MW of grid-connected solar projects to be set up under Phase III of Raghanesda Solar Park in September 2018.

In the auction that followed in December 2018, tariffs between ₹2.84 (~$0.0378)/kWh and ₹2.89 (~$0.03847)/kWh wasquoted. Since these tariffs were considered as high by GUVNL, it scrapped the auction in January 2019.

Again in March 2019, GUVNL issued a revised Request for Selection (RfS) for the 700 MW solar and added a tariff cap of ₹2.70 (~$0.03594)/kWh.

The technical bid for this tender was opened in May 2019, and the tender was undersubscribed by 100 MW.

In the auction that followed during the same month, tariffs ranged from ₹2.65 (~$0.0353)/kWh to ₹2.70 (~$0.03594)/kWh to develop 500 MW of solar projects and the remaining 200 MW was left unallocated. The power purchase agreements for the 500 MW of projects were approved by GERC in July 2019.

GUVNL issued an RfS again in June 2019, retendering the remaining 200 MW of solar projects. The ceiling tariff for this bid was set as ₹2.65 (~$0.0353)/kWh. The bid submission for this tender closed on July 24, 2019, but since GUVNL did not receive any bids, the deadline was moved to August 7, 2019.

Finally, after the third attempt, GUVNL received a bid from GSECL offering to develop 100 MW at the tariff of ₹2.65 (~$0.0353)/kWh, which was also the ceiling tariff specified in the tender. Apart from GSECL, no other bidders showed interest in developing the projects due to the challenging conditions of the park.

GUVNL later sought the approval of GERC for continuing with the bidding process as there was only one bid due to a lack of competition, which is a rare occurrence. The GUVNL referred to the clause, “To ensure competitiveness, the minimum number of qualified bidders should be two. If the qualified bidders are less than two even after three attempts of bidding and the procurer still wants to continue with the bidding process, the same may be done with the consent of the appropriate commission”. The Commission then approved the tariff, considering the tariff discovered was the lowest in the particular auction.

Now, the last remaining capacity of the 700 MW capacity has been retendered.