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MoP Revises Guidelines For The Tariff-based Bidding Process

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To obtain round-the-clock (RTC) power from grid-oriented projects of renewable energy, supported by other power storage sources, the Ministry of Power (MoP) has issued amendments to the criteria/guidelines for the tariff-based competitive bidding practice.

The amendment specifies that the weighted average levelised tariff for every unit supply of round-the-clock electricity would be the bidding assessment parameter. The bidder who will quote the least weighted average levelised tariff will be selected.

According to the new amendments, if the bidder’s prescribed amount of power is less than the contracted amount of power then the bucket filling process will come into action for the capacity allocation, till the tendered capacity reaches its limit. This is different from the previous system that needed surplus qualifying participants (excluding the L1 bidders) to level the L1 bidder’s tariff.

In a bid to support the ‘Make in India’ program, the MoP, in November 2021, published a notification to provide local suppliers with the buying preferences in the power industry. Only Class-I local suppliers shall be allowed to bid on goods, services, or works when there is sufficient local competition, regardless of the buying rate. Global tender is an exception because when it is launched, only Class-I and Class-II local suppliers will be able to participate.

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In the global tenders bidding process, Class-I, and Class-II local suppliers along with non-local suppliers, will be permitted to take part.

In the same month, thermal generation companies were allowed to install renewable energy generation capacity under the ministry of New and Renewable Energy (MNRE) and the MoP published revised guidelines, either through open bids through developers or on their own, and provide it to the customers under power purchase agreements (PPAs).

Again, in the same month, to speed up the Inter-State Transmission System (ISTS) approval and planning process, the terms of reference of National Committee on Transmission (NCT) were amended by the MoP. This move is expected to make it easier to establish and integrate renewable energy projects into the power system.

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