Ministry of Power has notified Guidelines for Tariff Based Competitive Bidding Process for Procurement of Firm and Dispatchable Power from Grid Connected Renewable Energy Power Projects with Energy Storage Systems. These guidelines were notified on 9th June, 2023.
Promotion of competition in the electricity industry in India is one of the key objectives of the Electricity Act, 2003. To further this objective, the Indian government has issued new guidelines aimed at enabling the procurement of firm and dispatchable renewable energy (RE) power with energy storage through tariff-based competitive bidding.
The guidelines specifically focus on the procurement of firm and dispatchable power from grid-connected RE power projects. Firm and Dispatchable RE power refers to the supply of electricity according to the specified demand profile mentioned in the Request for Selection (RfS) or bidding documents.
The main objectives of these guidelines are as follows:
- Providing firm and dispatchable power to distribution licensees (DISCOMs) from renewable energy sources.
- Facilitating the addition of renewable capacity and meeting the Renewable Purchase Obligation (RPO) and Storage Power obligations (SPO) of DISCOMs.
- Establishing a transparent, fair, and standardized procurement framework based on open competitive bidding. This framework aims to ensure appropriate risk-sharing among stakeholders, competitive prices in the interest of consumers, improved project bankability, and reasonable returns for investors.
- Creating a framework for long-term inter-state and intra-state sale-purchase of power, as an additional measure to reduce sector risks.
The scope of these guidelines extends to the long-term procurement of firm and dispatchable power by Procurers, such as DISCOMs, from Renewable Power Projects through competitive bidding. This ensures that the procurement process aligns with the provisions of Section 63 of the Electricity Act, 2003.