SECI Floats 125 MW/500 MWh BESS Tender in Kerala With VGF

The Solar Energy Corporation of India (SECI) recently released a tender to set up a 125 MW/500 MWh standalone Battery Energy Storage System (BESS) in Kerala with Viability Gap Funding (VGF) support. The last date for bid submission is set as February 6, 2025.

This marks the 22nd standalone BESS tender in India. This is brought forward by SECI and the Kerala State Electricity Board (KSEB). Meanwhile, this is Kerala’s second standalone tender. It issued its maiden such tender earlier in 2022. The tender scope specifies that the Battery Energy Storage System Developer (BESSD) will be required to build and maintain a Battery Energy Storage System (BESS).

SECI released the tender after receiving interest from the Kerala State Electricity Board Limited (KSEBL) to facilitate the installation and utilization of energy storage systems on an “On-Demand” basis, tailored to suit peak and off-peak hour requirements. The tender brought multiple innovations upon in this tender against the earlier standalone tenders. These innovations are a great way to further refine the tender structure and requirements bringing in learnings from earlier ones.

Project Configuration:

SECI in its tender mentioned, “The project will be allocated to a specific substation located at a single point at 110 kV of Mylatti 220 kV. The KSEBL substation in Kerala will handle power injection into and withdrawal from the identified STU substation, including the transmission line connecting the project with the substation system, as specified in the RfS document. Metering will be conducted at this interconnection point where power is injected or drawn from the identified STU substation. The document specifies that the Battery Energy Storage Purchase Agreement (BESPA) will remain valid for 12 years from the scheduled commissioning date (SCD).”

In the case of early commissioning and capacity offtake by SECI, the tender mentioned, “BESSD must arrange for any augmentation of the battery capacity to meet the capacity criteria specified at the SCD. This ensures that the dispatchable capacity at the SCD is 100% of the contracted capacity and is maintained annually .”

For early commissioning the BESSD

The tender adds, “For early commissioning, the BESSD is eligible for incentives on a pro-rata basis. For example, the incentive will be 2% of the quoted capacity charges per month, calculated as 4% for the first month and 2% for the second month when commissioned two months early. Similarly, for commissioning three months early, the incentive will be 6% for the first month, 4% for the second month, and 2% for the third month, reverting to the quoted rate from the SCD.”

The VGF amount eligible for the developer will be limited to either Rs. 27 lakhs/MWh or 30% of the capital cost for the BESS, whichever is lower. The project must achieve financial closure within nine months of the effective date of the BESPA. For example, if the effective date is December 6, 2024, the deadline for financial closure will be September 6, 2025.