New Delhi: The Ministry of Power has proposed that energy storage installed under renewable energy (RE) and battery energy storage system (BESS) tenders must meet a domestic content requirement. The change is part of draft amendments to four sets of bidding guidelines. They cover grid-connected solar projects, wind-solar hybrid projects, firm and dispatchable RE projects with storage, and the procurement of BESS. The ministry has sought comments on the drafts by November 25.
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The draft also makes storage compulsory in wind-solar hybrid projects. The existing guidelines say storage “may” be added to a hybrid project. Under the proposed clause, “Energy Storage shall be added to the solar component of the hybrid power project, in accordance with the Order(s) of the Central Government and the Regulations issued by the Authority.” The clause goes on: “Such Energy Storage shall comply with domestic content requirement, in accordance with Central Government Order(s).”
The draft also deletes the three purposes for which storage could be added to a hybrid project under the current guidelines. These were “to reduce the variability of output power from wind solar hybrid project,” to provide higher energy output for a given capacity by installing additional wind and solar capacity, and “to ensure availability of firm power for a particular period.”
For grid-connected solar photovoltaic (PV) projects, the draft adds a proviso to the scope of the guidelines. “Provided that the Order(s) by the Central Government and the Regulations issued by the Authority for mandating Energy Storage Systems (ESS) installation along with Solar PV Project and domestic content requirements for such ESS shall be complied with,” the proposed text said.
The guidelines for firm and dispatchable RE power carry a similar addition. These cover RE projects with storage that supply power to discoms according to a set demand profile. “Such storage shall comply with the domestic content requirement, in accordance with the Order(s) issued by the Central Government,” the draft said.
The BESS guidelines would also require domestic content compliance in tender documents. “Suitable provisions shall be made, in the RfS, for compliance of domestic content requirement for BESS project, in accordance with the relevant Order(s) by the Central Government,” the draft said. RfS refers to the Request for Selection, the bid document issued to developers.
The draft also changes the payment security mechanism for BESS projects. Under the guidelines, a Payment Security Fund (PSF) supports payment of at least three months’ billing for all projects tied to it. The existing text says intermediary procurers “will” collect a non-refundable Rs 5 lakh per MWh from BESS developers for the fund. The draft changes “will” to “may,” caps the amount at “not exceeding” Rs 5 lakh per MWh, and allows it to be collected in instalments set out in the RfS.
In addition, the draft makes the payment optional. “Payment towards the PSF shall be optional for BESSD and the same shall clearly be mentioned in the RfS,” the proposed text said, using BESSD for BESS developers. If a developer opts in, the amount collected goes to the PSF set up by the Government of India for the intermediary procurer, along with accrued interest.
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The drafts were sent for comments to the Ministry of New and Renewable Energy (MNRE), the Central Electricity Authority (CEA), Central and state electricity regulators, state governments, Solar Energy Corporation of India (SECI), discoms, power exchanges and industry associations.