The Solar Energy Corporation of India Limited (SECI) has released a Request for Selection (RfS) for the development of a 125 MW/500 MWh standalone Battery Energy Storage System (BESS) in Kerala. This project, under the Viability Gap Funding (VGF) mechanism, aims to integrate renewable energy effectively into the grid. SECI, acting as an intermediary nodal agency, will manage the project under a Build-Own-Operate (BOO) model, with the battery energy storage designed for “on-demand” usage.
The RfS specifies a two-bid system through a global competitive bidding process. The bid submission deadline is by 4th February 2025. The estimated document fee is ₹50,000 plus GST, and the bid processing fee is ₹20,000 per MW, capped at ₹20,00,000. The Earnest Money Deposit (EMD) is set at ₹3,41,000 per MWh for each project, while the Performance Bank Guarantee (PBG) is mandatory.
The project site is located at the Mylatti 220 kV Substation in Kasaragod, Kerala, with interconnection at 110 kV. SECI has planned the facility to support one operational cycle daily, with provisions for two cycles, ensuring flexibility for peak and off-peak demands. The operational efficiency and maintenance requirements, including a minimum AC-to-AC round-trip efficiency of 85%, are critical performance criteria.
The timeline for project commissioning is 15 months from the signing of the Battery Energy Storage Purchase Agreement (BESPA), with allowances for part commissioning. In case of delays, liquidated damages proportional to the delay will be imposed, calculated based on the uncommissioned capacity and a per-day rate. The developer can opt to pay these directly to SECI or through encashment of the PBG.
The VGF mechanism supports up to 30% of the capital cost or ₹27 lakhs per MWh, whichever is lower. For this project, the VGF is capped at INR 135 crores, disbursed in five tranches based on milestones such as achieving financial closure, commercial operation, and subsequent annual performance. Developers must provide a bank guarantee equivalent to the total VGF amount before the first tranche disbursement.
Early commissioning is encouraged, with incentives of up to 12% of the quoted capacity charges for completion ahead of the Scheduled Commissioning Date (SCD). Developers are free to sell the early commissioned capacity in the market or to third parties, subject to SECI’s approval.
This initiative underscores SECI’s commitment to advancing renewable energy integration and addressing the variability of solar and wind power. By establishing a robust energy storage infrastructure, the project is expected to enhance grid stability and contribute to India’s renewable energy goals.
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