MoP Launches Fresh Version of Scheme For Bundling Thermal with Renewable Energy

The Ministry of Power (MoP) has repealed its scheme on bundling thermal/hydro power plants with standalone renewable energy projects, substituting it with a fresh scheme.

In November, 2021, MoP issued the ‘Scheme for Flexibility in Generation and Scheduling of Thermal/Hydro Power Stations through bundling with Renewable Energy and Storage Power’ to comprehensively cover replacement of thermal and hydro power with standalone renewable energy power or renewable energy combined with battery energy storage systems. This was done to help the distribution licensees to meet their Renewable Purchase Obligation (RPO) within the contracted capacity and without facing any additional financial burden.

Since the issuance of the scheme, says MoP, stakeholders have requested to allow:

• RE power plants established anywhere in the country to bundle their power with thermal/hydro power
• the sharing of gains between the generator and beneficiary in the ration 50:50 without subjecting to a cap of 7 paise/KWh, as was the case in the earlier scheme
• other incidental matters

In view of the above, MoP has repealed the current scheme to substitute it with a fresh scheme, which is summarised as below:

• Applicability: Any generating company (which generates thermal/hydro power) may establish or procure renewable energy from a renewable power plant which is either co-located within the premises or at new locations.
• Tariff Determination of RE power Plants: In case of RE power plant co-located within the premises of a generating station, the appropriating commission shall determine the tariff of RE supplied. Provided that such RE power plant shall be established through a competitive EPC tendering. In all other cases, RE shall be procured on a competitive bid basis.
• Transmission Charges: No transmission charges for  bundling RE power with thermal/hydro power when the RE power plant is co-located within the premises of a generating station.

The new scheme also specifies guidelines for transmission connectivity and access, scheduling and commercial mechanism, deviation settlement mechanism, renewable purchase obligation, and requirement of additional agreements to PPA/PSA.

Further, the Guidelines for tariff-based competitive bidding process and nomination of third party bid process coordinators will be issued shortly, states MoP. A trajectory for the replacement of thermal/hydro power with renewable power will also be issued shortly, it added.