IREDA appointed by MNRE to handle CPSU Scheme

The Indian Renewable Energy Development Agency Limited (IREDA) has been appointed by MNRE as the implementing agency to handle the Central Public Sector Undertaking (CPSU) Scheme Phase-II on its behalf in fresh amendments announced on Monday.

As per the amendment “all issues regarding time-extension and dispute resolution on force majeure events will also be dealt by IREDA.”

The memorandum reads “IREDA will now be entrusted with the task of conducting bidding for allocation of solar power projects in the Scheme with Viability Gap Funding (VGF) amount as a bid parameter to select project proponents. The maximum permissible VGF amount will be reviewed time-to-time by MNRE and will be reduced by it if the cost difference comes down.”

Currently the Solar Energy Corporation of India (SECI) handled the scheme on behalf of the ministry including conducting bidding on VGF basis for selection of government producers, time-extension and dispute resolution.

The ministry  noted “The VGF provided under the Scheme can be used by the government producers as their equity in solar projects being set-up under this. If a government producer sets up a solar PV project under the CPSU scheme in a solar park, both CFA as per solar park scheme and VGF under the CSPU scheme will be eligible.”

VGF is provided under the Scheme with the objective of covering the cost difference between the domestically produced and imported solar cells and modules.

For commissioning of solar projects the existing clause provided timeline of 18 months from the date of letter of award. The amended doc also reads, projects up to 500 MW are required to be commissioned within 24 months and for projects above 500 MW should alo be commission witin 24 weeks, however balance capacity needs to be commissioned within next six months.

In another amendment, the ministry said that the power produced can be used on payment of usage charges of not more than Rs 2.80 per unit. These charges stood at Rs 3.50 per unit in the existing clause.

The ministry also added a new clause to the scheme, which permitted IREDA to sanction solar PV projects unde the CPSU Scheme of up to 500 MW to any government entity at the L1 rate discovered in the most recent bidding round, within four months of the last bidding without the need for the entity to participate in it.

The CPSU Scheme Phase-II is aimed at setting up 12,000-MW grid-connected solar PV power projects under the government producers with VGF support for self-use or by government entities either directly or through discoms.