MNRE amends new guideline for selection of 3000 MW Grid connected solar PV power projects

The Ministry of New and Renewable Energy has brought new amendment to the guideline for selection of 3000 MW Grid connected Solar PV Power Projects under NSM, Phase-II, Batch-II. The Section 3.5 stands modified as follows:

Existing  provision

Modified provision

3.5 Qualification Criteria for Short-Listing of Bids/ Projects A. Financial Criteria Infusion: Minimum paid up share capital will be Rs. 1.2 crore per MW. 20%  of the  paid  up share  capital shall  be  infused   at  the  time  of signing of PPA and 50% at the time of Financial  Closure and shall be supported with the relevant bank statements. Remaining will have to be infused before commissioning.

3.5 Qualification Criteria for Short-Listing of Bids/ Projects A. Financial Criteria Infusion: The SPD shall be required to demonstrate/infuse capital in the form of Equity for an amount of at least Rs. 1.2 crore / MW. This infusion shall be done@ 20% at the time of signing of PPA, 50% at the time of Financial Closure and shall be supported with the relevant bank statements. Remaining will have to be infused before commissioning. Share premium will form an integral part of Equity provided it is realized in cash or cash equivalent.  However, this condition will not apply in case of listed Companies.

This year in September MNRE issue guidelines for smooth implementation of grid connected solar rooftop projects.

Ministry of New and Renewable Energy’s scheme for grid connected rooftop solar projects states that the Central Financial Assistance (CF A) would be 30% of the benchmark cost or actual project cost, whichever is lower, for such projects in residential, social and institutional sectors in General Category States/ UTs and 70% for such projects in Special Category States/ UTs. MNRE notes that there is achievement linked incentive scheme for rooftop solar projects in Government and PSU buildings. The present benchmark cost as per notification dated 4^th March 2016 is Rs. 7.5 Crore per MWp (i.e. Rs. 75 per Watt).

In this regard, the ministry has received references regarding difficulties faced by SNAs / Discoms in selection of Channel Partners and limited capacity of selected partners, and also regarding allowing developers/ Channel Partners directly without tendering /transparent bidding.

Channel Partners are being empanelled by MNRE based on accreditation and due diligence by Qualified Rating Agencies regarding the technical and financial strengths of the Channel Partners. However, that there is no provision for determining market based cost / tariff under the current process said the ministry in a statement.

In order to ensure transparency as well as to infuse required push in the solar rooftop installation, MNRE issued following guidelines:-

a)  Implementing agencies (SNAs/ Discoms/ Municipal Corporations etc.) should undertake, transparent competitive bidding based on the capacity sanctioned / approved by MNRE.

b)  For the purpose of transparent bidding, at least 70% of the approved / sanctioned capacity should be provided in the Tender Category. However, any Implementing agency may include higher capacities (say 80%/ 90%/100%) in the Tender Category

c)  Such competitive bidding/empanelment process may be done on annual basis.

d)  In the Tender Category, sub-allocation and other tender conditions should be so framed by the implementing agency that proper incentive to the winning bidder (Ll), equity among bidders and fulfilment of the available demand by winning bidders, etc. are ensured. Minimum 20% of the tendered capacity or actual bid capacity of the L1 should be ensured to the winning bidder (L 1).

e)  For installation of the rooftop solar projects, aggregation of demand, increase in awareness of consumers and proactive coordination with several agencies are essential. Hence participation of large number of project developers/ Channel Partners/ New Entrepreneurs is required for rapid expansion of rooftop projects. Accordingly, the balance 30% capacity, to be called as Open Category, should be kept open for all project developers/ Channel Partners / New Entrepreneurs. Even the successful bidders from the tender category may be allowed to participate.

f)  For such Open Category, the lowest project cost / tariff discovered under the competitive bidding in the Tender Category should be applied.

g)  In this Open Category, maximum 5% the total approved/ sanctioned capacity can be given to any project developer / Channel Partner / New Entrepreneur including successful bidders from Tender Category. The allocation of quantity to the project developer / Channel Partner / New Entrepreneur through open category should be done in a transparent manner.

h)  Further, Price Safety Mechanism as per the Manual on Policies and Procedures for purchase of goods should be incorporated in the contract / work order.

i)  States / UTs should develop adequate system of checks and precautions for maintaining accurate records of beneficiary, uploading them on SPIN portal of MNRE and linking beneficiary through the Aadhar based database.

MNRE says that these guidelines will be applicable only on prospective basis.