Rajasthan Genco Issues 1GW BESS Tender With VGF

In one of the first, a power-generating company (Genco) in Rajasthan has issued a tender for 1 GW of Battery Energy Storage (BESS) project with Viability Gap Funding (VGF) support. The Rajasthan Rajya Vidyut Utpadan Nigam Ltd (RVUNL) has invited bids for the development of 1,000 MW/2,000 MWh standalone battery energy storage systems (BESS) under a tariff-based global competitive bidding process with viability gap funding (VGF) support. The projects will be developed under a Build-Own-Operate (BOO) model.

The tender, aimed at improving grid reliability and facilitating the integration of renewable energy, will see RVUNL act as the intermediary procurer, managing the charging and discharging of energy stored in the battery systems.

Under the tender conditions, selected developers will be required to design, finance, construct, own, operate and maintain the battery systems for a 15-year contract period. The systems must be capable of delivering two full charge-discharge cycles per day, with a guaranteed monthly availability of 95%. A minimum AC-to-AC roundtrip efficiency of 85% is also mandated, with penalties and incentives linked to performance.

Developers must ensure system degradation is managed over the contract life, maintaining dispatchable energy availability starting at 98% in year one and declining to no lower than 70% by year fifteen. Capacity replenishment during the project lifecycle will be the responsibility of the developer.

Infrastructure and Connectivity

Developers will be responsible for connecting the battery systems to the State Transmission Utility (STU) network, including construction of bays and transmission infrastructure up to the interconnection point. Costs for this infrastructure, including bay construction by RVPNL and protection systems, will be borne by the developer.

Land for the projects may either be arranged by the developer or acquired from RVUNL on actual cost basis. RVUNL will assist with land identification and acquisition if needed. Developers are also required to install appropriate fire safety systems, given the risks associated with battery installations.

Regulatory Compliance

Developers must comply with applicable regulations under the Electricity Act, 2003, and associated grid codes. RVUNL will oversee the system’s charge and discharge schedules based on instructions from the State Load Dispatch Centre (SLDC). Any deviation-related penalties under the Deviation Settlement Mechanism (DSM) will be borne by the developers.

Project Capacity and Bidding Limits

The minimum bid size is 100 MWh (50 MW x 2 hours), while the maximum cumulative allocation per bidder is capped at 250 MW/500 MWh. Projects are to be located across Rajasthan, with final sites to be aligned with STU connectivity.

The selection will be carried out through an e-bidding process, followed by an e-reverse auction. Only commercially established and operational technologies, as specified in the tender documents, will be permitted.

The initiative is part of Rajasthan's broader push to integrate large-scale renewable energy into the grid while addressing intermittency and peak demand challenges.

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