With formal approval, 20 GW of RE capacity on its way for green corridor

The Ministry of New and Renewable Energy (MNRE) has notified the President’s approval for the implementation of the “Intra-state Transmission System Green Energy Corridor (GEC) Phase- II” scheme, which will enable the creation of intra-state transmission infrastructure required for the power evacuation of renewable power projects in the country.

The projects, which would have approx. 20 GW total capacity, will be based in 7 implementing states: Gujarat, Himachal Pradesh, Karnataka, Kerala, Rajasthan, Tamil Nadu and Uttar Pradesh.

• The balance 67% of the project cost is available as loan from KfW/REC/PFC.
• Concessional Loans from KfW, Germany: A Joint Declaration of Intent for concessional loans for establishment of Green Energy Corridors has been signed between the Governments of India and Germany. Under this Declaration, concessional loans of total EUR 400 Million is available as committed by KfW, Germany. This can be availed by the seven States.

PROJECT IMPLEMENTATION:

• The STUs may divide these projects into various packages for ease of tendering and implementation. The STUs shall submit the list of packages along with their respective DPR costs [i.e. the cost excluding the Interest during Construction (IDC) already approved by Central Electricity Authority (CEA)] to MNRE within four weeks of issue of the sanction order. All the packages must be tendered and awarded to the contractors by the STUs within a period of two years, i.e. by 31st December 2023.
• Any major changes in the sanctioned projects before the award of work (like addition of new transmission line / substation, etc.), with proper technical justification, may be done with technical appraisal of CEA and sanction of MNRE within a period of two years, i.e. by 31st December 2023. The sanction of MNRE will be a pre-requisite before the tender is awarded.
• As the projects under GEC Phase-II are different from those in GEC Phase-I, the funds for GEC Phase-II will not be used by the States for projects under GEC Phase-I. Further, for the States which are also implementing GEC Phase-I, the CFA under GEC Phase-II will be disbursed only after commissioning of all the projects under GEC Phase-I in that state.

RELEASE OF CENTRAL FINANCIAL ASSISTANCE (CFA):

• The STUs may divide the projects into various packages for ease of tendering and implementation. The CFA under the scheme will be given at 33% of DPR cost or Awarded cost – whichever is lower and will be computed for each package separately. The CFA will be disbursed to the STUs in two instalments, viz. 70% after award of work and 30% after commissioning of work.
• The first instalment of 70% CFA for a particular package will be subject to the following conditions:

      i) Work included in sanction order of MNRE is tendered and awarded to the contractor;

   ii) For transmission lines: all statutory clearances (like crop compensation, forest clearances etc.) are available for a   contiguous line length which is at least 80% of the total line length;

      iii) For Sub-stations: 100% land required should be acquired by the STU

• Balance 30% CFA will be released after successful commissioning of the project and performance testing of the project which would inter-alia imply operation of the project for three months based on following pre-requisites:

       a) Completion of work and 3 months performance testing by Implementing Agency.

      b) Recommendation report from CEA which would evaluate the CFA claims based on Work Completion Certificate/Report; Certificate of synchronization of the commissioned substation/transmission line with the grid along with date of synchronization; and Performance testing certificate of the Project.

The whole notification released by MNRE can be accessed here.