MSEDCL Issues Tender for 487 MW Solar Projects Under Component A of KUSUM Scheme

Maharashtra State Electricity Distribution Company Limited (MSEDCL) has issued a tender for bids under component A of the KUSUM (Pradhan Mantri Kisan Urja Suraksha Evam Utthan Mahabhiyan)  scheme, that has a focus on improving incomes of farmers and generating solar power at the scale. Until now, most of the solar success under KUSUM has been seen in component B, which is effectively the off grid component of the scheme. This is the second tender from MSEDCL under the KUSUM scheme within 3 months, after its previous tender in June.

IN KUSUM component A, schemes can be between sizes 0.5 MW to 2 MW. Under the scheme, 10,000 MW of Decentralized Ground Mounted Grid Connected Renewable Power Plants of individual plant size up to 2 MW are being targeted across India. Preferably on barren land. In case of agricultural land, use of stilts to host the solar plant is mandated. Component  A in KUSUM is the only one that is not focused on solar irrigation pumps. Component B is about stand along solar pumps, while scheme C is about grid connected solar pumps .  Winning bidders will enter into a power purchase agreement with MSEDCL for a 25 year period.

MSEDCL has set the ceiling tariff for this tender at Rs 3.10/unit, with a non refundable processing fee of Rs 5,000 per MW. A net worth requirement of Rs 1 crore per MW makes it a little challenging for farmers who might be interested.

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A low Capacity Utilisation Factor level of 15% means some bidders might go for using multicrystalline modules, if they can source them cheaply from domestic manufacturers, as KUSUM scheme mandates DCR.

Interestingly, generators are allowed to go for repowering once in the 25 year period, for a period not exceeding 6 months. The Scheduled date for commissioning has been set at 12 months from the date of award of LOA.

The last date for submission of bids is September 17, 2021.

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While we can safely expect many more states to follow up with their own tenders to fill up Component A projections under the KUSUM scheme, one hopes that systems at government agencies have been streamlined sufficiently to enable timely approvals and support for the winning bidders. We have seen how, in a string of judgements from APTEL this month, government agencies have been found to be at fault for delaying projects, and the generators agony compounded further by the state regulator taking the side of the government agencies.