750 MW Rewa Ultra Mega Solar Power Plant
Manu Srivastava Why 750 MW REWA project makes for a pertinent case to study ?
India Achieved Grid Parity with Rewa Project. Project became the tipping point for solar power in India due to its innovative structuring.
Solar Power Tariffs showed a historical decline from 7 US ¢/unit to 4.5 US ¢ /unit The Project has been acknowledged as a model project by Government of India. Many of its features have been included in the Standard Bidding Guidelines for solar projects of Government of India. Madhya Pradesh decides to do their own thing
• Rs 5 with VGF vs Rs 5.05 without VGF by MP • Request for freedom to ‘do your own thing’; • Allowed, but no VGF support; • Fixed tariff under VGF falls from Rs 5 to Rs 4.50;
Formation of RUMSL: A Joint Venture Company • Approval: State Cabinet approval in April 2015 • Formation: Formed in June 2015 • Staff: No full-time employee • Infrastructure: No office • BoD: Board of 3(2 from SECI)
Previous Solar Bids Results
SECI State and Project Project Fixed Tariff Lowest VGF Capacity (Rs./kWh) (MW) Uttar Pradesh - UP Solar Park 440 Rs. 4.43/kWh VGF – Rs. 74.99 lakhs/MW (DCR)
Andhra Pradesh - Anantapuramu Solar 500 Rs. 4.43/kWh VGF – Rs. 44.50 lakhs/MW Park Gujarat – Charanka Solar Pak 250 Rs. 4.43/kWh VGF – Rs. 69.75 lakhs/MW UP – Solar Park 315 Rs. 4.43/kWh VGF – Rs. 99.95 lakhs/MW
NTPC State and Project Project Capacity (MW) Lowest Tariff Discovered
Andhra Pradesh – Gani Solar Park 500 Rs. 4.63/kWh
Rajasthan – Bhadla Solar Park 420 Rs. 4.34/kWh
Karnataka – Pavagada Solar Park 500 Rs. 4.78/kWh
Karnataka – Pavagada Solar Park 100 Rs. 4.84/kWh Rewa Results
Unit Winner 1st Year Tariff 1 Mahindra Susten 2.979 2 Acme 2.970 3 Solenergi 2.974
Levelized Tariff: Rs 3.30 OFF TAKERS
First Solar Project in India having different Categories of Off-takers:
Madhya Pradesh Power Management Company Limited and Discoms (Licensed Utilities) Benefit to MPPMCL over 25 years (NPV basis, considering their current lowest solar power procurement): Rs. 2,086 Crores
Delhi Metro Rail Corporation (Open Access Consumer) Benefit to DMRC over 25 years (NPV basis, considering their current procurement from Discoms): Rs. 1,220 Crores
List of Bidders: 20 totalling 7500 MW FOREIGN COMPANIES INDIAN MULTINATIONAL COMPANIES SB Cleantech Seven Ltd. (Soft Bank, Japan) Azure Power Thirty Four Pvt. Ltd.
GDF Suez Energy India (Engie, France) Shapoorji Pallonji Infrastructure Pvt Ltd
Enel Green Power Development S.R.L. (Italy) Aditya Birla Renewables
Green Infra Wind Energy Ltd. (Sembcorp, Singapore) ReNew Power Ventures Pvt. Ltd.
Solenergi Power (Mauritius, a company of Ostro Energy) Hero Solar Energy Private Limited
Canadian Solar Energy Holding Singapore 3 Pte Limited Acme Solar Holdings Private Ltd.
Mahindra Susten Pvt. Ltd.
Torrent Power
AMPL Cleantech Pvt. Ltd.
Orange Renewable Power Private Limited
ACB (India) Ltd.
Narmada Hydropower Development Company
Rose Petal Solar Energy Pvt. Ltd. (Adani)
Rattan India Solar 5 Limited Rewa project in media Rewa project in media Rewa project in media Rewa project in media Rewa project in media Rewa project in media Rewa project in media Rewa project in media Rewa project in media
Enhancements that made low tariff possible without viability gap funding
Addressed critical risks • Offtake upfront • Evacuation • Land
Leveraged Govt. support • Strong project structure to lower cost of capital • Internationally bankable PPAs & Project Agreements
• Single comprehensive charge structure Low Land & Infra Charges • Lowest charge across solar parks
• Proactive consultations to address project specific Carefully managed risks transaction process • Reputed Transaction Advisers: IFC
Footer Key Learnings 1.Diverse category of consumers
. Distribution licensee under obligation to procure power from renewable energy sources as mandated by the regulatory framework
. Large institutional consumer (Delhi Metro Rail) looking to reduce energy costs
2. Energy contracts tailored to meet consumer demand pattern
. Guarantee energy offtake quantity coincident with the demand profile of the consumer (institutional customer)
. Supplier protected against non-availability or partial availability of power evacuation system beyond the Delivery Point
3. Addressing critical risk upfront resulting in Low park and Infrastructure charges
. Timely acquisition of project land
. Single comprehensive charge structure
. Access to low cost funding from Clean Technology Fund to develop evacuation infrastructure
4. Equitable distribution of risk among procurer and developer
. Developer to submit an unconditional, irrevocable and on-demand Performance Bank Guarantee on commissioning
. Penalty on procurer for failure to offtake guaranteed energy quantity
Power procurement through Optimum Scheduling Time block wise Optimum Scheduling explained for a day 800
700 Generation of 99 MW Solar power in case of conventional scheduling 600 Generation for 750 MW solar Park
500
400
300
DMRC demand for 200 each of the time blocks 99 MW DMRC LTOA 100
0
6:15 6:30 6:00 6:45 7:00 7:15 7:30 7:45 8:00 8:15 8:30 8:45 9:00 9:15 9:30 9:45
14:00 14:15 10:00 10:15 10:30 10:45 11:00 11:15 11:30 11:45 12:00 12:15 12:30 12:45 13:00 13:15 13:30 13:45 14:30 14:45 15:00 15:15 15:30 15:45 16:00 16:15 16:30 16:45 17:00 17:15 17:30 17:45
Total DMRC Consumption Total Generation for 750 MW Generation in conventional (99 MW) Power procurement through Optimum Scheduling
Time block wise Optimum Scheduling explained for a day 800
700
600
500 Energy scheduled to MPPMCL beyond DMRC consumption 400 or 99 MW limit Again all Energy generated scheduled 300 All Energy generated to DMRC scheduled to DMRC
200 99 MW DMRC LTOA 100
0
6:15 6:30 6:00 6:45 7:00 7:15 7:30 7:45 8:00 8:15 8:30 8:45 9:00 9:15 9:30 9:45
14:00 14:15 10:00 10:15 10:30 10:45 11:00 11:15 11:30 11:45 12:00 12:15 12:30 12:45 13:00 13:15 13:30 13:45 14:30 14:45 15:00 15:15 15:30 15:45 16:00 16:15 16:30 16:45 17:00 17:15 17:30 17:45
DMRC Drawal MPPMCL Drawal Total DMRC Consumption Total Generation for 750 MW Generation in conventional (99 MW) Savings for DMRC through Optimum Scheduling Optimum Scheduling Regular Scheduling DMRC LTA Capacity (MW) 99 164 PoC Charges* (₹/MW/Month) 204838 204838 Energy offtake (in MU) 345 345 CUF (in percent) 24 24 Total annual PoC charges 24.33 40.312 (in ₹ crore) LTA charges (₹/kWh) 0.705 1.168 Savings 15 crores/year or ₹ 0.46/kWh
• POC Charges (as per CERC Order dated Feb 2018)* Rs./MW/Month 204838 ; • POC charges would be different for different quarter, it’s a variable number. Therefore, saving might vary from quarter to quarter Payment Security Mechanism for RUMSL Three layer of protection provided to SPDs under this mechanism
Letter of Credit (LC) Payment Security Fund GOMP Guarantee
As per Clause 10.6 (A) of PPA As per Clause 10.6 (B) of PPA As per Clause 10.6 (C) of PPA
• Procurer shall set up and maintain a • RUMSL, on behalf of the SPDs will set up a • As a final layer of protection GoMP monthly unconditional, revolving and payment security fund with a corpus of INR guarantees the due and punctual irrevocable letter of credit (LC) in favour 480,000,000 (four hundred and eighty million) or payment of any undisputed amount, of the SPD. an overdraft or guarantee facility of the same which are directly payable by the size. Procurer and due to the SPD and/or • The LC shall have a term of 12 months RUMSL. and subsequently renewed for next 12 • The payment security envisages to cover • RUMSL can invoke GOMP guarantee if months. payment of the monthly bills and/or any outstanding dues raised by it supplementary bills to be made to the SPDs. remain unpaid for 30 days.
Payment Security Mechanism Strictly private and confidential 2 May 2017 Draft 4 Geographic location of Solar Parks
550 MW Agar 500 MW Shajapur
450 MW Neemuch Proposed Transaction structure of New Solar Park (Optimal Scheduling)
“Maximizing energy supply from solar park to meet consumer energy demand using Optimal Scheduling approach from CTU interface with support from MPPMCL”
Sale of solar power from the New Solar Project Developer (1,500 MW) – CTU Solar Park to MPPMCL and Connection Indian Railways Supply to Indian Railways - 203 MW (778 MUs) PPA (Indian PPA (MPPMCL) Railways) Sale to MPPMCL – 1,297 MW (2244 MUs generation to Solar – 1,297 MW, Solar – 203 MW, 778 MUs MPPMCL) 2244 MUs
Power Sale to Solar park connected to CTU Indian Railways (outside MP) Consumption in MP
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