Solar Energy Corporation of India’s 1,000MWh energy storage tender winner revealed

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Bidding took place last week in a reverse auction to contract for 500MW/1,000MWh of standalone battery energy storage capacity with the Solar Energy Corporation of India (SECI).

Various news outlets reported on Friday (26 August) that JSW Renew Energy Five, a special purpose vehicle formed by the renewable energy subsidiary of power producer JSW Energy had submitted a winning bid.

SECI tendered for two 250MW BESS projects to be constructed at the same location, connecting to India’s Inter-State Transmission System via a substation at Fatehgarh in the state of Uttar Pradesh.

Bidding continued for more than 10 hours, with bids from major Indian companies like ReNew Solar Power, NTPC Renewable Energy and Azure Power, as well as international entities such as energy trading investment company Hartree Partners Singapore.

According to a bidding portal seen by Energy-Storage.news, JSW won with a bid of INR1,083,500 (US$13,590) per MW. With a broad spread of bids seen, this was 111% lower than the lowest-ranked bid out of eight entries in total.

Officially launched by SECI in April after several months of anticipation from the industry, the pilot tender is designed to be replicable for other tender programmes and help to inform how they will be conducted.

A total of 4,000MWh of pilot tenders for standalone energy storage are expected to be launched in total by the government of India. This is in addition to activities at state level, such as the current 500MW tender for renewables with storage being run by the electricity board in the state of Gujarat, to give one example.

Energy-Storage.news has reached out to SECI for official confirmation of the tender result and further comments.

At our webinar on India with Clean Horizon, which took place in June, Dr Bharath Reddy, SECI additional general manager, explained that the pilot deployments’ applications will include energy arbitrage, helping utilities to shift surplus energy from off-peak times to be used on the grid during peaks and could help reduce curtailment of renewable energy.

SECI will also be “reserving some capacity to the grid operator” so that the use of battery storage for ancillary services like frequency response will be trialled. As yet, India has not rolled out widespread programmes for ancillary services in which batteries are eligible to take part, but this is understood to be changing.

Developers will also be able to sell some of their battery storage capacity in the open market, Dr Reddy said. SECI will sign contracts to utilise 60% of project capacity through a battery energy storage purchase agreement (BESPA), leaving 40% of BESS capacity for the developer to monetise as appropriate.

Performance criteria included 95% minimum availability of resource on an annual basis, factoring in annual degradation expected.

Project owners should maintain 85% or higher roundtrip efficiency of their asset. Charging and discharging schedules will be set by the off-taker, with a ‘resting period’ of one hour with BESS assets to be utilised for up to two full charge-discharge cycles per day. Non-availability and lower-than-promised efficiency will be penalised.

Watch our June webinar, which includes a breakdown of economics for the SECI tender and other business models for energy storage in India, from Clean Horizon analyst Rachel Loquet as well as contributions from Dr Bharath Reddy, SECI and Dr Rahul Walawalkar of the India Energy Storage Alliance (IESA), here on our YouTube channel.

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