PPA-starved power companies seek changes in rare 25-year RE + Thermal tender

New Delhi: Thermal power producers have sought changes in tender documents for a 5,000-mw renewable-plus-coal power supply, citing difficulties deterring them from participating in a rare 25-year long-term tender in a decade.

Private power companies have written to the Union power ministry asking changes in the tender rules to allow them access to domestic coal supply and claim compensation for change-in law situation in future. The companies have sought to become signatory to the power purchase agreement as the tender documents in present form allow agreement between only renewable power developers and the Solar Energy Corp of India (SECI), which has floated the tender.

The Association of Power Producers in its letter to power secretary Sanjiv Sahai has also sought extension of the bid submission deadline by one month from the present September 15.

As per the bidding document, the renewable power developer is required to bid and enter into agreement for an aggregate bundled quantum of renewable plus thermal capacity, of which 51% should comprise green energy. However, since the thermal companies will not be part of the agreement, they will not be eligible for securing coal from coal companies.

The arrangement is only good for companies which have imported coal tie-ups. However, lack of PPA with SECI will disallow thermal companies to approach regulators seeking change-in law relief if the coal costs or levies rise or in case of other unforeseen circumstances over 25 years of supply period.

The association said the thermal company will also be unable to claim fiscal relief available to mega projects. In case renewable developers tie-up with thermal power companies for participating in the tender, they may require a trading licence and be subject to higher taxation in the absence of clarity from the government.

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“The proposed changes are required to ensure wider participation, reducing stress in projects with linkages but no PPAs and reduce uncertainties for bidders . Consequently, it would help to drive down the price bids,” Association of Power Producers director general Ashok Khurana said.

“The final sets of bid documents were published on August 27 with bid submission date as September 15. There were very crucial queries raised in the pre bid meeting held on September 2 and clarifications from SECI are yet to be issued. This leaves very little time – less than a week, for bidders to design a serious and implementable bid for a project of this magnitude which also involves tie-up between RPD (renewable power developer) and Thermal Generator. It is therefore suggested that the bid submission date may be extended by at least a month,” the letter said.



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