Projects, Energy & Infrastructure Monthly Newsletter: February - March 2025

In this Section

MoP issues Amendment to the "Guidelines for Tariff Based Competitive Bidding Process for Procurement of Firm and Dispatchable Power from Grid Connected Renewable Energy Power Projects with Energy Storage Systems " dated February 12, 2025

MoP issues Guidelines for Tariff-Based Competitive Bidding for Procurement of Storage Capacity/Stored Energy from Pumped Storage Plants on February 6, 2025

Central Electricity Regulatory Commission (Connectivity and General Network Access to the inter-State Transmission System) (Fourth Amendment) Regulations, 2025

Fourth Amendment to APERC Electricity Supply Code (Regulation No. 5 of 2004)

KERC Issues Discussion Paper on Fixation of Norms and Determination of Tariff for Procurement of Power from Municipal Solid Waste (MSW)-Based Power Generating Plants for FY26 dated February 28, 2025

KERC issues Discussion Paper on Fixation of Norms and Determination of Tariff for Procurement of Power from Rooftop Aero Turbine with Solar or Without Solar for FY26 dated February 28, 2025

KERC Issues Discussion Paper on Determination of Tariff and Norms for Solar Power Projects (Including Solar Rooftop Photovoltaic Projects) for FY26 dated March 18, 2025

MNRE issues the Updation of List I (Manufacturers and Models of Solar PV Modules) of ALMM Order, 2019

RERC issues the RERC (Terms and Conditions for Det

MoP issues Amendment to the "Guidelines for Tariff Based Competitive Bidding Process for Procurement of Firm and Dispatchable Power from Grid Connected Renewable Energy Power Projects with Energy Storage Systems " dated February 12, 2025

• The Ministry of Power (MoP) vide its notification dated February 12, 2025, notified the amendment to the Guidelines for Tariff Based Competitive Bidding Process for Procurement of Firm and Dispatchable Power from Grid Connected Renewable Energy Power Projects with Energy Storage Systems (Guidelines).
• Clause 3.1.1(b) of the existing Guidelines has been modified to clarify that deviations in the draft RfS, draft PPA, and draft PSA from these Guidelines and/or SBDs require approval from the Appropriate Commission. However, for a bid, if deviations were approved before these amendments, fresh approval is not needed. Detailed provisions consistent with the Guidelines will not be considered deviations.
• A new Clause 3.3 has been added, which provides that in case of locationspecific bids, the procurer may specify the sub-station(s) in Inter-State Transmission System (ISTS)/ Intra-State Transmission System (InSTS), where the developers will connect the Renewable Energy Power Project.
• Clause 7.6(b) has been amended to state that if a generator fails to maintain the minimum CUF for two consecutive years (excluding the first contract year), it will be considered in default. The minimum CUF obligation will then be reduced to the average CUF of the two default years. In such cases, the generator must pay lump-sum damages equivalent to 24 months or the balance PPA period, whichever is less. Failure to pay these damages may be treated as an event of default, leading to PPA termination, with the generator liable for additional damages.
• The Change in Law provision under Clause 7.7 of the Guidelines has been modified to be in accordance with the Electricity (Timely Recovery of Costs due to Change in Law) Rules, 2021. Additionally, the term "Change in Law" (CIL) now refers to any event occurring from seven days before the last date of bid submission.
• Technical criteria have been specified under Clause 9.2.1, wherein the developer is required to install and maintain GPS-enabled Automatic Weather Station (AWS) as per the technical specifications and standards specified by the relevant Central Government agency. The availability of data from such AWS shall be ensured as specified by the appropriate Load Dispatch Centre and other Central Government agencies in accordance with the provisions of the Indian Electricity Grid Code and instructions from the appropriate Load Dispatch Centre from time to time.
• A new Clause 10.3 has been added, which mandates that in normal circumstances, the signing of the PPA and PSA (if applicable) should be completed within 30 days from the issuance of the LoA. This period may be extended up to 12 months from the LoA date, beyond which the LoA will be cancelled.
• Clause 11.4 has been modified to require the distribution licensee or Intermediary Procurer to approach the Appropriate Commission for adoption of tariffs discovered through the competitive bidding process within 30 days of tariff discovery.
• The amendment introduces new provisions under Clause 12.1(a1) and Clause 12.2(a1) for the establishment of Earnest Money Deposit and Performance Bank Guarantee, respectively, allowing the use of Insurance Surety Bonds or any other instrument approved in the General Financial Rules as amended from time to time by the Central Government.
• Clause 12.3 has been modified to clarify that the Performance Bank Guarantee (PBG) or its alternatives can be encashed to recover any damages or dues of the generator under the PPA. The recovered amount will be credited to the Payment Security Fund. The PBG must be returned within 45 days of the actual commencement of supply, with partial releases allowed for part-capacity commencement.

MoP issues Guidelines for Tariff-Based Competitive Bidding for Procurement of Storage Capacity/Stored Energy from Pumped Storage Plants on February 6, 2025

• The guidelines aim to facilitate India's energy transition by promoting PSPs, ensuring grid stability, and integrating renewable energy. The National Electricity Plan 2023 projects a requirement of approximately 74 GW/411 GWh of Energy Storage Systems (ESS) by 2031-32, including 27 GW/175 GWh from PSPs.
• The guidelines apply to developers, end procurers, and intermediary procurers for procurement of storage capacity or stored energy from new, under-construction, or existing PSPs.
• Competitive bidding will be used for procurement under Section 63 of the Electricity Act, 2003. The procurers must obtain prior approval from the Appropriate Commission for any deviations from these guidelines. The bidding process follows a single-stage, two-part format (technical and financial bids), with an option for e-reverse auctions.
• In order to be eligible under the Guidelines, the bidders must demonstrate experience in infrastructure sector projects and meet financial criteria such as net worth equivalent to at least 20% of the estimated capital cost of the contracted PSP capacity.
• The Minimum bid capacity under the Guidelines is 50 MW for ISTS-connected projects and at least 10 MW for InSTS-connected projects, with flexibility for smaller projects in special category states.
• The Guidelines further state that the agreement for procurement will be executed through a Pumped Storage Purchase Agreement (PSPA) or Power Purchase Agreement (PPA) between the procurer and the developer. Also, Performance Bank Guarantee (PBG) and Earnest Money Deposit (EMD) must be provided, with specific amounts determined by the estimated project cost.
• The developers must meet specified technical performance criteria, including minimum availability and efficiency standards, in the event of failure to maintain the committed capacity results in liquidated damages, with penalties for non-performance equal to 1.5 times the PPA tariff for shortfalls.
• According to the Guidelines, financial closure must be achieved within 12 months of PPA signing, with penalties for delays and developers must secure transmission connectivity within 60 days of receiving the Letter of Award (LoA).
• With respect to supply, the Guidelines state that, PSP projects must commence supply within 48 to 66 months, depending on project type and part commissioning is allowed, with payments made on a pro-rata basis.

Central Electricity Regulatory Commission (Connectivity and General Network Access to the inter -State Transmission System) (Fourth Amendment) Regulations, 2025

• The Central Electricity Regulatory Commission (CERC) notified the draft fourth amendment to the CERC (Connectivity and General Network Access) Regulations, 2025 (CERC GNA Regulations 2025) introduced to address inefficiencies in grid utilization, curb speculative trading of transmission connectivity, and enhance regulatory compliance in renewable energy integration.
• The amendment seeks to optimize transmission assets by introducing "Restricted Access", allowing renewable generators to inject power based on predefined solar and non -solar hour schedules, thereby ensuring better utilization of idle transmission capacity during non -solar hours. It also restricts changes in ownership or shareholding of connectivity grantees until the Commercial Operation Date (COD) to prevent speculative transfers. To enhance compliance, it mandates strict timelines for project commissioning, requiring developers to submit bank guarantees and commissioning schedules, with revocation of connectivity rights for non -compliance beyond 18 months. Additionally, State Transmission Utilities (STUs) are now permitted multiple start dates per year for additional GNA, improving planning flexibility.
• CERC GNA Regulations 2025 introduces 'Restricted Access' to optimize inter - state transmission system (ISTS) utilization. It allocates solar -hour and non - solar -hour scheduling rights, ensuring that wind -based and energy storage systems (ESS) can utilize idle transmission capacity during non -solar hours. This prevents underutilization of infrastructure and supports India's growing renewable energy sector, promoting efficient grid management and transmission planning for better power distribution.
• To prevent speculative trading of connectivity rights, the amendment restricts ownership or shareholding changes of connectivity grantees until their Commercial Operation Date (COD). This measure ensures that only committed developers secure transmission access, reducing the risk of entities acquiring connectivity and reselling it. Any changes in shareholding before COD now require prior approval from the Nodal Agency, strengthening accountability, regulatory oversight, and project stability in the renewable energy sector.
• Aiming to enhance compliance and project execution timelines, the amendment mandates that connectivity applicants submit Bank Guarantees (Conn -BG1, Conn -BG2, Conn -BG3) and adhere to an 18 -month commissioning deadline. If a project fails to meet this deadline, connectivity is automatically revoked, ensuring that idle capacity is reallocated to serious players. These measures discourage delays, improve project planning, and help meet India's renewable energy integration targets while maintaining transmission system efficiency.
• Recognizing the need for flexibility in power procurement, STUs can now apply for multiple start dates (up to four per year) for additional General Network Access (GNA). This change addresses varying state power demands and allows for better forecasting and procurement strategies. By enabling staggered GNA approvals, the amendment helps states avoid transmission bottlenecks, improve grid reliability, and ensure optimal allocation of transmission capacity in response to fluctuating energy needs.
• To enhance grid coordination and scheduling transparency, the amendment requires NLDC to declare solar and non -solar hours weekly, with flexibility for weather -based revisions. Additionally, restricted -access entities must coordinate power scheduling through a Lead Generator or Qualified Coordinating Agency (QCA). These changes streamline grid operations, reduce scheduling conflicts, and promote efficient energy dispatch, ensuring that India's renewable energy transition is managed in a structured and efficient manner .

Fourth Amendment to APERC Electricity Supply Code (Regulation No. 5 of 2004)

• The Andhra Pradesh Electricity Regulatory Commission (APERC) issued the Fourth Amendment to the Electricity Supply Code (Regulation No. 5 of 2004) on February 24, 2025, introducing major changes to the metering, billing, and payment structure for electricity consumers in the state. The amendment aligns with national smart metering policies set by the Central Electricity Authority (CEA) and the Ministry of Power (MoP) to modernize electricity consumption monitoring, reduce revenue losses, and promote prepaid billing systems.
• The CEA (Installation and Operation of Meters) Amendment Regulations of 2019 and 2022 mandated that all new consumer meters must be Smart Meters with a prepayment feature, replacing conventional meters within government -specified timelines. The MoP notification on August 17, 2021, further set deadlines for this transition. Following these national directives, the Andhra Pradesh DISCOMs, APSPDCL, APCPDCL, and APEPDCL submitted official requests to APERC in 2024, urging amendments to the Electricity Supply Code and General Terms and Conditions of Supply to accommodate smart meter implementation.
• To ensure stakeholder participation, APERC published a draft notification on January 1, 2025, and invited public objections, suggestions, and comments. The initial deadline of January 22, 2025, was later extended to January 29, 2025, following requests from DISCOMs and consumer groups. By the deadline, APERC had received 32 objections and suggestions from various stakeholders, including consumer welfare groups, industries, apartment resident associations, energy policy researchers, and former APERC officials. Despite significant opposition from consumer groups, APERC upheld most of the proposed changes, emphasizing efficiency, automation, and revenue protection.
• They key takeaways from the amendment include mandatory prepaid smart metering and e -wallet system, elimination of physical bills for smart meter consumers, etc. A more balanced approach with rebate incentives, optional physical billing, and lower recharge requirements would have made the transition smoother and fairer.

KERC Issues Discussion Paper on Fixation of Norms and Determination of Tariff for Procurement of Power from Municipal Solid Waste (MSW) -Based Power Generating Plants for FY26 dated February 28, 2025

• The Karnataka Electricity Regulatory Commission (KERC), vide its discussion paper dated March 2025, has proposed norms and the determination of tariffs for power procurement from Municipal Solid Waste (MSW ) -based power plants for FY26.
• Converting MSW into electricity, while not the most efficient method, contributes to sustainable waste disposal and energy security when executed within global emission standards. The Commission has previously set a generic tariff of Rs. 7.08 per unit for MSW -based power projects commissioned between September 19, 2016, and March 31, 2025. This tariff structure continues to be extended, reinforcing India's focus on waste -to -energy (WtE) projects.
• The Commission proposes a useful life of 20 years for MSW -based power plants. The plant load factor (PLF) is set at 65% during the stabilization period and 80% thereafter, while auxiliary consumption is capped at 15% of total power generation.
• The financial parameters include a capital cost of Rs. 2100 lakhs per MW, with a debt -equity ratio of 70:30. The return on equity is proposed at 14% per annum. Loan repayment is planned over a tenure of 13 years with an interest rate of 11.10% per annum.
• Depreciation is set at 5.387% per annum for the first 13 years, with the remaining depreciation spread over the balance years. Operation and maintenance (O&M) expenses are proposed at 6% of the capital cost, escalating annually at 5.25%.
• The working capital requirement is equivalent to two months' receivables, with an interest rate of 11.50% per annum. Based on these parameters, the Commission proposes a levelized generic tariff of Rs. 8.07 per unit for 20 years, with provisions for projec t -specific tariff determinations within defined ceiling limits.
• The Commission also considers a discount factor of 11.97% for the purpose of computing the levelized tariff, by allowing cost of debt at 11 .10% and return on equity at 14%.
• The Commission proposes to determine a levelized generic tariff of Rs.8.07 per unit for a period of 20 years from the date of achieving commercial operation during effective period as per the computations. However, the Commission would consider determining project specific tariff by considering the above norms as ceiling limits .

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